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The Right Time to Add Capacity

Knowing when to add capacity is one of the most overlooked decisions in firm growth. In this video, Andrew Town shares his insights on how to approach this critical decision strategically.

 

"What do you like to spend money on? Gifts? Vacations? Concert tickets? Most people don’t love parting with money, but it’s easier when it leads to a great experience. That’s why so many advisors put off adding capacity—it just doesn’t seem as exciting as growth. But waiting too long can create serious challenges."

 

Capacity planning isn’t just about hiring. It’s about ensuring that your business has the bandwidth to retain top talent, keep clients happy, and seize opportunities for growth before you're forced to react. Yet too often, owners wait until something breaks – an overburdened team, an unexpected departure, or missed opportunities – before making a move.

Why Capacity Planning Matters

Many owners struggle with knowing when to make their next hire or what role to prioritize. Making these decisions based on guesswork instead of forecasting can lead to compounding issues, sometimes quickly, sometimes over a couple of years.

Here’s how capacity impacts your business:

  • Your team: Low capacity can drive burnout and make it harder to retain key people.

  • Your clients: When you’re stretched too thin, they notice – and they hesitate to refer new business.

  • Your growth potential: The difference between affording an opportunity and absorbing it can determine whether your business thrives or struggles.

 

The Most Successful Business Owners Do Three Things Right

They analyze their business’s metrics. Instead of guessing, they look at the data to identify where the biggest opportunities for improvement are.

They hire ahead of growth. Some of the most successful owners hire before they absolutely need to, and they can’t imagine doing it any other way.

They model out different scenarios. They take a strategic approach – anticipating their future needs, assessing financial impacts, and making informed decisions.

 

 

A Critical Reminder

Unlike other business decisions, capacity is a moving target. Just like your clients’ financial plans need ongoing adjustments, so does your firm’s staffing and operational structure. If you haven’t reviewed your business’s capacity in a while, now is the time to check if you’re positioned for sustainable growth.

Optimize Your Business's Capacity

At FP Transitions, we help firms like yours plan ahead, so you’re not forced into reactive decisions. Our consulting, financial, and legal expertise helps you look into the future, model different scenarios, and create a complete picture of your ideal firm and the steps to get there.

 

Whether it’s strategic hiring, scaling for growth, or combining with another firm to expand capacity, we’re here to help you make informed, forward-thinking decisions.


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