As an entrepreneur of a small business, the odds of becoming a successful multimillionaire might not be in your favor, but achieving lasting success certainly is. Transitioning from a small-scale startup to a thriving, self-sustaining enterprise is not only possible but probable if you follow tried-and-true business growth strategies.
Business growth is the stage of the business life cycle when an entrepreneur can pursue opportunities to expand their company and increase profits. The particular business growth strategy to adopt is varied—from acquisition to diversifying your product line to finding a new market. How fast should a company grow? The answer lies with what makes sense for your business.
To take your business to new heights, let’s go through our guide to best practices for business growth.
Business Growth Strategies
Whether your objective is to scale your business, grow revenues or increase your margins, every business owner—regardless of industry—needs a detailed strategy to achieve their goals. A good place to start when learning how to grow your business is to evaluate market conditions. Depending on the outlook of the market, you may be better served by taking some courses of action over others.
Here’s an overview of business growth strategies:
1. New Markets
When you’ve achieved a level of success with your current product or service and your customer base in your present geography, you might consider expanding into new markets. This could mean broadening your product line or services, trying to capture a new customer demographic or establishing your stores or delivery options to a wider geography—or a combination of 2 or all 3.
Whichever option you choose, conduct a market analysis to ensure you have a sustainable path for business growth.
2. Market Share
As opposed to seeking new markets, you can seek to capture a larger portion of the existing market—your market share—with your established products or services. You can find your market share by dividing your sales or revenue by your industry’s sales or revenue during a certain period of time.
To increase your market share, stay on top of trends or innovations that can put your product or service ahead of the competition. Also ensure that you’re keyed into your customers’ conversations (on social media or other Internet platforms) and responsive to their questions or concerns.
If you’re ready to expand your business, but don’t immediately have the capital or human resources to add a location, franchising your company could be a path forward. You can franchise your business to scale an existing growth model to be emulated by other franchisees. You will have to spend money to attract, onboard and support franchisees, as well as pay any legal or attorney’s fees to get your Franchise Disclosure Document in order. However, the franchisees are responsible for putting up the capital to get your expanded business operational. Franchising can be a great way to grow your company without paying the full expense or losing equity.
4. Forge Partnerships
Growing a small business is also a matter of finding the right partners and forging lasting, strategic partnerships with them.
Finding the right business partners, either in the form of an informal agreement or a joint venture, is vital for solidifying your company’s lasting success. Reach out to other businesses that have something to offer your own, and those that can benefit from exposure to your market as well.
5. License Your Product
One of the best ways to grow your business growth strategies is to find a product that is central to your brand that performs well in comparison to others in your lineup. Once you’ve identified the winning product, have a qualified attorney draft a licensing agreement that other retailers can use to sell the product. For every sale made, your business should receive a predetermined share of the revenues.
6. Diversify Your Lineup
If you want to grow your business, don’t limit yourself to what is safe and comfortable—branch out and experiment with new products or services that differ from your existing line. You could find greater success by offering a product that appeals to an untapped segment of the market.
It’s not always easy to find a product to add to your lineup. There’s risk involved any time you decide to manufacture and distribute something new. Do your homework to find where pain points exist within your market’s niche and craft a marketable and cost-effective solution.
7. Acquire an Existing Business
Purchasing another business can help you grow your business by capturing higher market share or diversifying your portfolio while taking on an established clientele. If you have identified a competitor within your industry whose assets would help you attain a larger percentage of market share, you could inquire about buying the company outright.