What does growth look like to your business?
Growth and success mean different things to different businesses. Your plans could be as grand as aiming for multi-million pound turnover in the next five years, or as humble as starting to sell online in 2015.
It’s important that you choose the right goals for your business, based on solid research (more about that later) and that you have a clear plan of the tactics you will use to achieve them. Often it can be tempting to think only tactically, but it pays to take some time to think about why you’re doing it and how you will measure the success of all your hard work with financial forecasts to back it up.
First, consider how scalable your business is. If its current success is dependent on one or two key members of staff and their skills, large-scale growth through increased volume may not be achievable.
However, this doesn’t mean you can’t grow, just that you might have to look at other alternatives, such as being more innovative around your product or service.
Three ways to grow...
Develop a new or improved product
In a recent Forum member Growth Panel, we found that most businesses are focusing on product and positioning to increase sales, rather than competing on price.
But before you develop a product, you need to do your research. What do customers think of your existing products? What do they want from a new product? A good understanding of your customers, as well as your competitors, should inform any decisions you make. Forum members can download a free guide to getting started with market research.
Add value through additional services
As well as tangible products, you could think about ways that you could offer added value services for sale or to improve your existing product/service. Unlike products, these can often be delivered at low cost and potentially without time restraints. Examples of free services include user guides, comparison service or a newsletter. Paid-for services could include consultancy.
Think about who your customers are and what they care about – what services could you develop that would make their life easier?
Make your processes more efficient
Improving efficiency can have a big impact on your bottom line (see our cost-cutting growth tips here). Look at where you might be wasting time and money, and how you can increase capacity. This will not only help you in running your business, but can actually mean you deliver better quality to your customers. And more happy customers means more repeat business!
Preparing for growth
There is more to growth than just making more sales. With any plans to grow your business, you also need to think about how your business would cope with additional workload and any infrastructure changes you might need to put in place.
By making sure you’re prepared in advance, your business will be ready to take advantage of opportunities when they arise, rather than missing out to a competitor.
Managing business resources
Good employees are the engine that keeps your business running, but getting the best out of them under pressure can be a tricky balancing act.
Periods of growth will almost always require increased effort from staff. You typically have two choices here; ask existing employees to do more and potentially spend some money and management time in the process, or look to hire more people with the required skills.
With the latter, you need to consider whether you can afford to take on a new member of staff. Alternatives could include fixed-term contracts or outsourcing.
The cash flow question
It’s a catch-22 situation; growing a business can certainly bring in more money, but you often need cash up front to fund it. After all, increasing inventory, taking on new employees, moving premises, investing in plant and machinery all cost money.
We hear from small businesses all the time just how difficult it is to access funding, with many using their personal savings and overdraft facilities to fund growth. However, if you are looking to external finance, from the banks or alternative finance providers, a well-thought out business plan will definitely give your chances of success a boost.
Members of the Forum have access to a helpline for all your business queries so if you need further advice on growing and protecting your business, call 0845 130 1722.
We’d also love to hear your plans for 2015, and in particular any success stories you may have – email email@example.com and you could end up featuring on the blog or in our member newsletter.