It’s not enough to just say you want to grow your business. You need a plan of action that covers every aspect of growth, ensuring you grow at a rate that is both healthy and sustainable.
We refer to this as a business growth strategy. You can call it whatever you want, but the point is that your business cannot really sustain any growth or expansion without it.
What is a Business Growth Strategy?
A business growth strategy is essentially a plan to take your business from point A to point B, with point A being your current size/state, and point B being where you would like your business to be in the future. It details where you want to go, the steps you will take to get there, and what you need to measure along the way to ensure success.
Why You Need a Strategy
It’s not enough to ask “what is a business growth strategy?”. You need to understand why your business needs this strategy in the first place. Without a plan in place, your business will either become stagnant, or will grow too rapidly. Neither scenario is where you want to be. Growing too large too quickly means you aren’t able to keep up with demand, and could end in bankruptcy or folding up shop. Not experiencing any growth means your business will inevitably fail because your current revenue won’t be enough to keep up as expenses increase.
Having a strategy keeps your business consistently moving forward at a pace you can sustain long term.
Is Your Business Positioned for Growth?
Before you can even begin to think about expanding, you have to honestly and deliberately measure the health of your business. If your business is struggling at its current size, what makes you think it will suddenly become robust and healthy if it’s larger?
Here are some of the factors that indicate business health:
- Customer satisfaction: happy customers aren’t likely to go anywhere. And customer retention is one of the best measurements of your business’ health and security.
- Team culture and happiness: when you invest in a positive culture, it will have an impact on everything your business does. When your teams are in an environment where they thrive, along with being challenged, encouraged, and given room to grow, they are more likely to work harder for your business and your customers.
- Value: have you determined exactly what sets your business apart from your competition? Have you capitalized on this unique value you offer current and potential customers?
- Revenue: if your business is not consistently generating new income, you don’t need to think about growing yet.
- Profitability: you might be generating revenue, but it’s pretty pointless if you’re spending everything you bring in. If you have not streamlined your budget to ensure profitability, growth and expansion will not be possible
- Adaptability: expanding your business means change. If you and your teams aren’t able to adapt and change quickly, this growth could be difficult and even detrimental.
Types of Business Growth
Once you’ve assessed the health of your business, you can begin to strategize growth. There are a few ways to grow your business. We’ve outlined them below.
- Market Penetration: one way to grow is to simply sell more of your current product or service to more customers.
- Market Expansion: this kind of growth involves offering your current product or service to a new market or region. An example of this would be creating an ad campaign that targets a new region to increase the number of people you serve.
- Product Expansion: within every business, there are products or services you could add or incorporate that allow for growth while still creating value for your customer. Think of every Apple product ever made as a prime example: while each of these products could work independently, they are designed to be better together. It keeps customers loyal to one company for their computer, phone, and watch needs.
- Acquisition: as we’ve mentioned before, your business can also grow quite rapidly by acquiring another business, allowing you to harness more talent to serve more people. In order for this acquisition to be beneficial and effective in helping achieve your goals, it needs to involve two relevant services or products, make financial sense, and increase the value you offer customers.
It’s impossible to just white knuckle your business into growing. You need a strategy and a plan to make sure that your business can sustain growth and stay healthy for a long time. This strategy will help guide the decisions and steps you make to ensure your business is around for far longer than a five year plan.
Achieving your goals for growth and expansion is impossible without a team of people to help you in the work. Learn more about using a team approach to grow your business.