business

To Grow: Think Regional, Act Local

Take the best possible care of the customers you already have, market astutely, hire wisely, plan realistically -- and the rest takes care of itself

By Donna Boone

I opened my swim school in Ashburn, Va., in December, 2003, realizing an entrepreneurial dream that began when I swam competitively in high school. By April, I had signed up nearly 800 students -- almost exactly what I projected in the business plan I developed with my angel investors. Within the next five years, I hope to open four additional indoor swim schools located throughout the larger Washington, D.C. metro area: two in Northern Virginia, one in Maryland, and perhaps one in West Virginia.

I have always wanted to build a business. For me, nothing is more exciting than the prospect of taking a small but important seed -- me and my talents and skills -- and transforming it into a significant organization with its own personality and character. While a mom-and-pop operation or a "lifestyle" business might have its attractions, that's not for me.

BIRDS IN THE HAND.

  Building a business internally from small and local to regional and growing – as I am doing with Potomac Swim School – requires concrete actions. The specific actions will be different for each kind of business, but all revolve around one core principle: think regional, plan, and manage local. The same principle applies when moving from regional to national, or from national to global:Think national, think global -- but always, always plan and manage local. In other words, while acting with an eye to the future, never be anything less than fully committed to the customers and other relationships you have right now.

What follows is a look at the four growth strategies I've integrated into my business, and how this fundamental principle is integrated into each.

Choose the right market.

Competition is great. But let's face it, lack of competition is even better. While I always knew I would start a private swim school, I didn't know exactly where. I did know the area had to be affluent. I also knew that it had to have a relatively high proportion of stay-at-home parents, those with the time to shuttle their children to and from swim classes.

In my research, I found that all of the country's metro areas had the right demographics, but that only the Washington, D.C. area lacked a private swim club. That answered the market question for me. If I did it right in Washington, D.C., I would have an entire regional market to myself.

Keep existing customers happy.

For two years prior to launching my business, I taught swimming at a private health club in Tysons Corner, Va., in the heart of Washington's booming suburbs. I deliberately chose to keep my student roster small to maintain a high level of individual attention and specialized instruction. If parents were going to pay me to teach their children to swim, I was going to justify their expenditures. The reason was simple: I was building my reputation for the day I opened my own school.

As the owner of a new business, I would have to make the most of my limited marketing dollars. Direct mail and limited public relations were all I could afford. Word of mouth -- or "viral" marketing, as it's called in the trade -- would have to do the rest. In other words, the trick was to insert my sales pitch into a network that would deliver my message for free. For a child-centric business, few networks are as powerful as parents. They can and do make or break such enterprises, much in the way "foodies" make or break a new restaurant.

Leverage new communications tools. Combine a satisfied network of customers with today's Internet-related communications technologies, and you've upped your growth potential geometrically. In Washington, D.C., for example, many stay-at-home parents communicate through local newsletters with names such as Haverford Happenings. These publications, which cover streets, neighborhoods, towns, or even entire metro areas, can function as the building blocks of your viral-marketing efforts.

As for my business, a satisfied parent, whose daughter had taken my swim class, sang my praises in a bi-weekly newsletter called Family News. The result: an influx of 36 of my first students. This is far from an isolated example. Augmented with chat rooms and Web logs, or "blogs," these vehicles provide a far-reaching, direct -- and free -- method for leveraging satisfied customers into an ever-increasing flow of new customers.

Hire with an eye to later roles.

Apart from satisfied customers, a growing company needs skilled and competent managers whom founders can trust. Here again, the fundamental of thinking regional, acting local comes into play. At present, Potomac Swim Club is poised to exceed the targeted projections set in my business plan, allowing me to consider a second club sooner that I had anticipated. However, I must first find a manager with whom I will be comfortable sharing authority. This is a classic stumbling block for entrepreneurs seeking to expand companies.

In my case, I expect to promote from within, which means I must hire with an eye to developing managerial talent. No longer can I view employees merely as part-time swim instructors. Instead, I must look at them -- and treat them -- as potential managers, even partners. I must consider whether they are individuals as committed as I am to both swimming and the school and to learning the business from the ground up.

My experience thus far convinces me there are always significant untapped markets waiting for the right entrepreneur to service and transform into a substantial, growing enterprise. But growth itself is hard. The trick is to tackle those markets with an eye to a larger future, while never forgetting that discipline, commitment and consistency in the present lay the groundwork for continued growth.

Donna Boone, 38, founded and serves as president of the Potomac Swim School in Ashburn, Va., the only year-round, private, indoor swim facility in the Washington, D.C. area. Founded in 2003, the company provides instruction in groups of no more than four for children aged six months to 18 years. Its 21 part-time instructors -- all of whom have swum competitively -- serve 800 students. Revenue on an annualized base is running at $600,000. Boone expects to open additional swim facilities in the metro Washington suburbs and exurbs over the next five years.

Entrepreneur's Byline comes to BusinessWeek Online readers courtesy of EntreWorld.org, a resource for entrepreneurs that is sponsored by the nonprofit Ewing Marion Kauffman Foundation.

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