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Understanding the Right Time to Take a Risk for Your Small Business

For us, at Sanborn Canoe Co. there has been real value in taking things slow. Entrepreneurs do what they do for a reason. They love to dream and dream big. Now, you may have a big end goal in mind, but it is important to lay a foundation first. This involves taking a lot of small steps first before you take any big leaps.

Laying the foundation for your small business

Our business started as a few friends who had been camping together for years and wanted to make some of our own gear. We spent hundreds of hours throughout one summer building a cedar strip canoe and paddles. We went into this project with limited resources. Basically, all we had was a how-to book and a friend’s dad who was willing to lend us the tools we needed. Somewhat to our amazement, the canoe and paddles turned out great and had us wondering, “could we turn this into something more?”

Throughout the following fall, we set out to work on our dream. Each day we put in the time to master our skills as craftsmen and establish design characteristics that would define what a Sanborn paddle would look like. By the following winter, our skills had grown and with it, we had gained enough confidence to turn our passion into a business. Based on this we sought out a few local shops who generously decided to give us a shot. Our paddles weren’t perfect, but they were good and getting better each day. We have been in business now for eight years, growing a bit each year.

Taking a risk as a small business owner

Of course, we have taken a few risks through the years, but generally, we are very cautious. One of the biggest steps we have taken was to add canoes to our lineup. We’d been making paddles for six years when the opportunity came up to buy a company that had been making canoes for 60 years. Building canoes had been a dream of ours since the very beginning, but each boat is a bigger investment in time, material, and space. This was an opportunity that seemed unimaginable before it appeared, but once it came we jumped at it.

When is the right time to take a risk?

For each person and each business, answering the question of when is it the right time to take a risk will be different. It’s important to figure out a balance. On one hand, taking a risk is costly. It is never limited to the upfront cost either. There are things that keep coming up that you couldn’t have imagined at the beginning. Adding canoes included some obvious things like the cost of purchasing the company, moving, training and building our own craftsmen team. Also, the cost is not limited to cash. Taking a risk can take a toll on a person as you pour yourself into learning new things and working overtime to get everything rolling. On the other hand, if you wait to take a risk only when you feel you are fully prepared, chances are the opportunity might pass you by. We have gone through significant growing pains over the past couple years since bringing on the canoe company, such as cash flow crises to strained and broken relationships. Many of these costs caught us off guard and nearly ruined us. It’s important to truly weigh the potential cost against the reward.

Create clear communication guidelines

Out of this circumstance comes another piece of advice. Be as prepared as you possibly can be when going into anything new. I mentioned there can be issues with strained relationships. Ours is a family business so a strained relationship is no small issue. One major way to do this is to create systems that make workflow and the flow of information second nature. Make lines of communication clear and never assume you have been understood. Beyond keeping you sane, this helps people work together and actually function as a team. Everyone is more efficient and will enjoy what they do more when they know what’s expected of them.

A risk isn’t truly a risk if you know how it is all going to turn out. We approached building canoes with incredible excitement, but with significant questions. We knew that we had built a solid foundation through years of cautious decision making. We knew who we were and what our brand was about. We had built up a reputation for beautiful, quality products. Piece by piece, we had put together a talented team who work hard and trust each other. When you have a quality product, solid branding, and a great team with systems in place for clear communication you can take risks with a lot of confidence. It’s much easier to take a leap of faith with a solid footing underneath you.