Your business needs a business growth strategy, especially if you are a small or medium-sized business.
The statistics are clear, startup businesses are risky, but a quality growth strategy can help. As Entrepreneur Magazine elucidates, “If only half of startups survive more than five years and only one-third make it to 10, what’s the one thing you could do to ensure your company is sustainable? The answer is to create a growth strategy for your business, of course.” Business growth strategies are vital for well-established businesses as well, and they can (and should) change as markets shift, customer priorities change, or labor markets respond to cultural change.
But a business growth strategy is much more than hoping for the best. The best growth strategy has a framework, and a detailed plan for how you get from where you are to where you hope to be.
We’ve established a list of 7 key steps to creating a business growth strategy that works.
Determine areas for growth
Any effective business growth strategy must begin with identifying the target area (or areas) for growth. HubSpot explains, “It’s great that you want to grow your business, but what exactly do you want to grow? Your business growth plan should hone in on specific areas of growth.” They go on to suggest some of those areas:
- “Growth in revenue and/or profit”
- “Growth of customer base and/or customer acquisition rate”
- “Growth in employee headcount”
- “Addition of new products and/or services”
- “Expansion of current office, retail, and/or warehouse space”
- “Addition of new locations or branches of your business”
- “Expansion into new regions, locations, cities, or countries”
It’s not necessary to think of these as independent initiatives, as they may all be wrapped into your larger business growth strategy. The key is to know how you want to grow, and what that growth looks like to you.
Assess your base-line
It’s impossible to grow unless you know where you are starting. To develop a business growth strategy, you will want to realistically assess and analyze where you currently stand in terms of the key growth areas you identify in step one.
Do you want to expand into a different market? You will need to understand your capacities from growth, or for supporting a team in the target area. Do you have the infrastructure to warehouse new products, or do you have the right vendor relationships? Is your digital infrastructure as strong as it needs to be, or is a digital transformation needed to move your sales team to remote work?
This type of assessment isn’t only about identifying your weaknesses. Entrepreneur says, “Sometimes, focusing on your strengths — rather than trying to improve your weaknesses — can help you establish growth strategies. Reorient the playing field to suit your strengths, and build upon them to grow your business.” Both strengths and weaknesses, knowing your starting position will allow you to measure business growth.
Now that you know where you want to go, and you have assessed where you are, it’s time to do some research. Just like any business strategy, growth strategies necessitate a thorough understanding of your industry, and of the broader market.
- Understand your current and potential customer base: Entrepreneur explains, “You got into business to solve a problem for a certain audience. Who is that audience? Is that audience your ideal customer? If not, who are you serving? Nail down your ideal customer, and revert back to this audience as you adjust business to stimulate growth.” Make sure that your ideal client can bear the growth you imagine.
- Know the state of your industry: Make sure that you know and are anticipating the trends in your field. HubSpot says, “Researching the state of your industry is the best way to determine if your desired growth is both necessary and feasible.”
- Understand your labor market: Recent events have set off an explosion in remote work and in many fields an aggregate increase in salary and benefits expectations. To compete for the best talent, you’ll need to understand these trends.
- Evaluate your competition: You will need to know how the other players in your field are faring. What are they doing particularly well? Where are they missing? Can your business growth strategy fill the gaps, or will you need to replace them in the market?
This research will inform your growth strategy framework.
Establish a value proposition
The better you understand what makes your business different from the rest of the market (aren’t you glad you did that research?), the stronger your growth strategies can be. Entrepreneur gets to the point exactly, “For your business to sustain long-term growth, you must understand what sets it apart from the competition. Identify why customers come to you for a product or service. What makes you relevant, differentiated, and credible? Use your answer to explain to other consumers why they should do business with you.”
Set measurable goals
With everything you’ve done to this point it’s time to set goals for business growth. Here’s the catch–your goals must be measurable. Entrepreneur says, “Changes must be measurable. If you’re unable to measure a change, you have no way of knowing whether it’s effective. Identify which key indicators affect the growth of your business, then dedicate time and money to those areas.” It’s nice to set a goal of customer satisfaction, but if you aren’t measuring that satisfaction in meaningful ways, it’s a weak business growth strategy.
Create your plan
The next step is to create the business growth strategy itself. What is the plan? What is the timeline? What do you need to execute and measure?
Consider any necessary growth tools. Do you have the technology you need for this growth cycle? If not, a digital transformation is needed in your growth strategy. Do you have the finances for the infrastructures you need, if not have you planned a capital campaign?
And, determine if you have the personnel for this growth strategy. Do you need to hire? Do you need to find outside professionals to work alongside you? If you need help, get it!
Execute and evaluate
And finally, it’s time to get to work. Implement your business growth strategy, evaluate its success over time, and adjust for changes as they develop.
iTransform would love to partner with you on your business growth strategy from framework to conclusion.