What Is Business Growth?
Getting your startup off the ground took hard work. But now, you might be thinking that you need to expand. Some signs that you’re ready may be if:
- Your cash flow is positive.
- The demand for your products or services is growing beyond your capacity.
- You’ve hired a strong team.
- You’re running out of space.
Some extra questions you’ll want to ask yourself to determine if you’re ready to grow include:
- Have you achieved most of your goals? If you have, that means it’s time to set new ones and work on expanding your operation.
- Do your customers ask you to expand? Maybe you keep hearing requests for more hours or more products. If this is becoming a common theme, it may be time to better understand your customer and broaden your operation.
- Is your industry growing? To see how other businesses are expanding, you can read through magazines, newspapers or industry research and trend reports.
How to Grow Your Business
1. Attract New Customers
Bringing in new customers is important for every business, especially startups. But before you get new people through your doors, you’ll want to understand who your target market is, how they think, what their habits are and how your product helps them.
From there, you can write your ads and marketing campaigns in a voice that relates to your new customers. This is important for creating a bond between your brand and target market.
Another way to attract new customers is by creating blogs and webinars that appeal to your target audience. These can help establish you as an expert in your industry, which encourages customers to ask you their questions and fulfill their needs.
Some other strategies that can help you attract new customers include:
- Asking for referrals: You can request these in person or via email.
- Networking: Introduce your business and get people talking about it by attending conferences and events.
- Offering discounts: Give free trials and discounts on your products or services.
- Teaming up with other businesses: Partner with other established companies who have similar audiences to give away products.
- Focusing on SEO: Update your website to include target keywords and other SEO features to be sure you show up where customers are searching.
2. Engage Your Existing Customer Base
One of the least risky strategies for business growth involves selling more to your existing customer base. For instance, you can bundle products or services together for a discount. You can also create loyalty programs to reward your customers and keep them coming back.
Another way to engage your customer base is by selling new products or services to your existing buyers. To do this, you’ll want to study what your customers need, and then develop products that fill those needs. You can also make updates to your current products to help engage existing customers.
3. Pursue New Distribution Channels
Increasing sales by introducing new distribution channels can also help you gain an advantage in your market. Typically, this involves selling your products to wholesalers, retail stores or on e-commerce marketplaces.
So, if you typically only have retail stores carry your products, expanding to wholesalers can increase your influence. This is because wholesalers have a larger access to outlets and other retailers, which can increase awareness of your brands and products. Wholesalers also make it easier to expand your merchandise to global markets.
Also don’t be afraid to use social media to sell your products. For example, Instagram has shoppable posts that allow you to connect your website to individual photos you share. This lets customers click through and buy products they see on your page.
4. Grow Your Business Through Acquisition
The larger your business gets, the easier it is to grow by buying other companies like your:
Competitors: If you buy a rival business, it’ll help you grow faster than just focusing on your current operation.
Suppliers: Buying your supplier can help lower your production costs. For instance, if you used to pay 50 cents to make your product, you can may be able to pay 10 cents to make them yourself.
Distributors: Buying their operation can help you cut costs, as you’ll be able to supply your products right to the stores, websites or wholesalers you work with.
Essential Considerations for a Growing Business
Implement a Growth-Focused Sales & Marketing Strategy
If you’re no longer able to focus on marketing strategies, this can be a sign that it’s time to expand your business plan. In fact, creating a marketing department in your startup may be your next step to enhancing your business growth strategy.
For instance, you may want to increase your digital marketing strategy. This type of marketing can help your growth because customers and competitors are increasing their online presence. Plus, it’s more cost-effective than traditional marketing and is the best way to reach consumers now.
On top of growing marketing at your startup, you’ll also want to expand your sales department. Some sales strategies that increase growth are:
- Expanding to new cities, towns or areas, so your sales team can have access to more clients and potential customers.
- Diversifying your products, so your team can sell to new markets.
- Sending email campaigns to existing customers with promotions, special discounts and more.
Also keep in mind that as your business grows, you’ll want to begin hiring industry experts to manage departments like sales and marketing. They’ll focus on tasks like:
- Tracking your brand's progress
- Creating marketing campaigns and ads
- Aligning your strategy with your target audience
Take Steps to Minimize Risk in Your Growing Business
There’s a lot of risk involved in starting a business, like:
Running out of funding: This could come from borrowing a loan that’s too small or over spending too soon.
Not hiring enough of the right people: Ideally, you’ll want to hire people who want to grow your startup, have strong organizational skills and are experts in:
- Sales and marketing
- Product development
You may also want to hire in-house counsel or attorneys that can represent your startup and give you legal advice. They can also help you understand which government contracts might benefit your business and which ones are not worth your time.
Trying to grow too fast: You can tell you’re growing at a rate that’s too quick if your expenses are higher than your revenue.
Not complying with federal regulations: For instance, if your business grows and has more than 10 employees, you’ll need to see if your work environment has new health and safety risks.
Failing to understand workplace privacy: While there are federal privacy laws, you’ll want to check with your state for more regulations to make sure you’re following them.
Getting the wrong insurance: To prevent this, you can do a business insurance coverage check-up. Looking at your policies periodically can help you address new risks and determine the right limits, so you pay the correct amount each month. One policy you’ll want to make sure you have is employment practices liability insurance.
Cultivate a Growth-Friendly Company Culture
One important long-term strategy for building a successful business is to hire the right people and create a positive environment.
To start recruiting and retaining top team members, you’ll want to:
Clearly communicate your business’ vision: It’s important that new employees know what they’re contributing to, especially since you won’t be able to pay much at first. This also helps you find talented people who are passionate about your industry.
Hire remote workers: This can help you expand outside your local area. You can also offer flexible schedules where your employees have the option to work from home one or two days a week.
Network: Speaking at conferences and events can help you promote your company to new talent looking for jobs. You can also accept resumes at these gatherings.
When searching for talent, look for those who are passionate about growing businesses and who are:
- Action takers
- Collaborative workers
- Team players
- Skilled in customer service
- Passionate about your industry or products
You can also increase your focus on employee compensation and benefits by offering employer-sponsored 401(k) plans to help with employee retention. Offering the right rewards to your employees can help keep them with your business for years to come.
Finance Your Growing Business
As your startup expands, financing business growth can become more important, but also more challenging. Generally, companies need to start new money management techniques and find other means of funding.
Some sources of money for financing business growth incluyen:
- Debt financing
- Equity financing
- Venture capital
- Leveraged financing
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