Today, more than ever, businesses need help to grow their business. Every business needs to monitor its performance to allow management to make clear decisions. In a business environment where change is essential for future growth, Asmat & Co helps you make the right choices for the best and efficient way forward. That advice, resulting in experience in advising a wide range of business types and sizes, can prove invaluable in helping to build a better business. It could for example improve the financial position of your business by allowing you to plan and monitor your cash flow more accurately.
Business Growth is a stage where the business reaches the point for expansion and seeks additional options to generate more profit. Business growth is a function of the business lifecycle, industry growth trends, and the owner’s desire for equity value creation.
Why is business growth important for a small business?
Most companies experience growth. However, the type of growth required will depend on the stage of growth the business is in. New companies usually need to grow in order to cement their position in the market and quickly get to a size that is large enough to bring in enough revenue to cover costs and is to make a profit.
Mature companies don’t need to grow quite as fast. However, they may still want to ensure their metrics are going in the correct direction. An increase in profitability, brought about by sales process efficiencies, could help a stable business build liquidity to protect against future risk; even if revenue and sales stay the same.
What ways are there to grow your business?
Organic Business Growth / Internal Growth
This is the most basic type of business growth but is more effective when growing your business. This type of business growth focuses more on manufacturing increased products and services and space for the success of the business.
Organic growth involves strategies such as:
- Developing new product ranges
- Launching existing products directly into new international markets (exporting)
- Opening new business locations – either in domestic market or overseas
- Investing in additional production capacity or new technology to allow increased output and sales volumes
Businesses such as Dominos, Apple, and Costa coffee have implemented successful organic growth strategies.
Strategic Business Growth
Strategic business growth is one that focuses on the long-term growth of the business. The businesses which focus on strategic growth have reached a peak of the organic business growth stage and are forced to find an additional market.
Strategize, consider the available options, and build some into your business plan. Depending on the kind of company your building, your growth strategy might include aspects like:
- Adding new locations
- Investing in customer acquisition
- Franchising opportunities
- Selling products online across multiple platforms
- Growth in employee headcount
- Expansion into new regions, locations, cities or countries
- Addition of new products and/or services
Your industry and target market will influence your decisions, but it’s almost universally true that new customer acquisitions will play a sizable role.
This type of business growth is used to reach a market which is previous untapped by the use of advertising power bank making additional products and adding them to the existing money inventory. The money which is generated from organic business growth is required by strategic business growth because the businesses will not experience watershed business acceleration and instead there will be a gradual rise in sales.
For some businesses, it is beneficial to merge or acquire or create a partnership with other businesses. This is also considered the riskiest strategy of business growth with more potential for success. A valid and executed merger or acquisition can help businesses to enter, sustain and grow in a new market.
It can also help to manufacture more products and gain increased customer loyalty
Benefits of this;
- More resources
- Sharing of the managerial load
- Larger skills and talent base
- Bigger pool of contacts
- Increase in markets
- Diversification and organic growth using increased resources
- Reduced commercial risk
The right partner should complement your core brand and business development goals, so consider carefully the type of partnership you plan to pursue to ensure the best chances of success.
Rapid Business Growth
When growth is needed in a short time, rapid business growth is the only option. During the period the production levels or customers or even staff increases at a great pace which can lead to certain risks and challenges. Cash flow shortfalls or customer service issues common for every rapidly growing business organization.
It is essential that you research the growth of your business. If your business grows too quickly or expands too much, you could experience financial legal, staffing, resource, and supplier problems. For business growth to be successful, it should be sustainable
Rapid business growth can do more damage to your business if it’s not planned out correctly.
- You could outgrow your premises in the short term. There may not be enough space for everyone to work efficiently.
- Morale may drop if staff cannot cope with the extra work. Productivity can decrease
- There may be a shortage of cash to meet expansion costs. Taking on more and more work to generate more income places additional pressure on your premises and staff.
- There may be a shortage of cash to meet expansion costs. Taking on more and more work to generate more income places additional pressure on your premises and staff
- Management may be under pressure, operating reactivity rather than proactivity.
- The quality of your products and services could drop, causing an increase in customer complaints. You may even lose customers to your competitors.
- Staff turnover may increase due to heavy workloads. Vital knowledge could be lost as staff leave. Hiring and training new staff takes time and money.
- Your business may lose touch with competitors` activities
- Growing your business may help you to overcome these problems and attract new customers if you move to larger premises and increase your resources and stock.
Planning for business growth
1, Startup – A business idea is created. Plans are put in place to start operation.
2, Commence – The business plan is complete and targets are established.
3, Operate – The business is operating and coping with any problems that arise. Systems are in place and, ideally, profits are made.
4, Expand – The business is very competitive. Management changes or expands to deal with the size or complexity of the business.
5, Review – The business is very competitive, Activities are regularly reviewed and changed to achieve ongoing success.
6, Diversity- The business diversifies into new markets, products, and alliances. Whether your business has just started or is ready to diversify, is important to plan growth so that it is controlled and properly managed. The following can help plan for growth
7, Set Goals for growth, Involve management and staff, control costs, regularly review targets and develop good systems.