When it’s time to grow your business, take a step back and weigh up your options.
There are many ways to grow a business – many of which we cover in our ‘growing your business’ section. But the mistake many small businesses make is launching into expensive strategies without thinking about whether they’re ready. After all, a bigger business isn’t always a better business. So, this guide tells you the key things to consider before you start building your empire.
Can your business expand?
Some businesses simply can’t grow exponentially because of the nature of what they do, or how they do it. And it’s important that, if you are one of these businesses, you realise that before you start investing in growth strategies.
Should your business expand?
Even if your business seems well-positioned to grow, it’s vital that you’re aware of the reality of attempting to grow your business.
Growth normally means that you’ll need to hire some more people. And hiring people is stressful and expensive – not to mention enormously time-consuming.
The next question is investment. Typically, businesses need a cash injection to grow and this is a decision not to be taken lightly. If your business is up and running successfully, securing a loan won’t be difficult. But taking on extra debt can be a burden, especially if you’ve previously had a positive flow of cash in your business.
What are your growth options?
There are, broadly speaking, different ways of growing.
You could sell more or additional products and services to existing customers. If you have strong relationships with a close network of customers, this can work well – they’ll want to buy more from you.
Another option is to alter your prices. You could increase your prices to grow; if you have a large customer base, a small increase could have a large impact, but can also be risky. Equally, if you want to increase your customer base, reducing your prices could be very effective.
Or, you could create completely new sales channels to attract customers. Many online-only businesses start trading in physical spaces to grow their brand, and vice versa.
And there are many other routes to growth too. You can start trading internationally, open up a new branch, join forces with another business or invest in technology that lets you increase your business capacity.
So, weigh up your options and pick one that suits your budget and aims.
How big do you want to be?
Growth on a large scale often happens rapidly. It’s also common for large businesses to grow in unusual ways – they can shrink first, or spend years in a stagnant position. The point is: growth can be unpredictable.
So before you set sail, think about how big you actually want to be – because getting really big will require a lot of effort, and possibly, a lot of sleepless nights.