There is so much talk about growing your business and the focus on increasing turnover and employing staff to prove your ‘growth success story’. More and more however I find that some small business owners need a little guidance on what ‘growth’ looks like.
As your business matures over time – there are few things that start to settle like: who exactly your customer is, what you sell them and how good you are at efficiently delivering your service or product to them.
In the first 3 years of business you are finding your footing, getting a good idea of pricing and establishing an awareness of your presence in the market place. You will find from year 4 or 5 though – you will have gained some traction (if things are going in the right direction). Your client numbers will hopefully be increasing, your workload is increasing…and more than likely your turnover is increasing.
When you are reviewing how to manage this traction…this is essentially where you are planning your route to growth. Here’s my high-level overview of three growth avenues for you:
This is when you essentially are doing it on your own – i.e. your own funds, blood, sweat and tears. You’ll be looking for ways to bring on an extra member of staff, or find suitable strategic partnerships to help you deliver your product or service.
There is a careful balance here on cash flow and how fast you can keep up with demand. Be mindful of what your role as business owner needs to be, and be open to other people helping. Putting systems in place and looking for efficiencies is really important.
I have written a much deeper blog post on this growth route for you, to give you more insights and guidance – ‘Growth Through Organic Expansion’. In this post I explain how ‘growth’ is measured; the challenges of this route; as well as the arguments for and against growing organically. Let me know what you think!
This is a route to growth, or indeed to starting a business (with a boost). Essentially within a franchise you won’t be starting from scratch, you will have the marketing and brand awareness already in place with the franchisor. (If you find a good one that is!) If you are an existing business, but you see a franchise that is essentially doing the same thing you want to do – but doing it better – it may be an option to look at buying into the franchise.
You will have your experience plus the support from the franchisor, which is not a bad thing. This does take investment of money and also a sacrifice of a level of ownership of your business (i.e. you won’t own your intellectual property).
In my deeper dive blog post ‘Grow by Franchising‘ I share more on this route if it’s of interest to you. In there I cover a proper definition of franchising; why you should choose to use franchising as a growth route; the challenges; and of course some of the factors that determine success in this model of business.
The way that some businesses grow quicker – is by buying competitors or other businesses which will add a good, complementary margin to the business. Look around you – who do you like that’s operating in the same marketplace. Would they be willing to merge or be interested in you acquiring their business?
We have dealt with many of these types of situations with clients, so I’d be happy to have a conversation if this avenue sounds of interest to you.
Acquisition is not without its pitfalls – so I have also written a fuller post all about the dangers of this route, as well as the pro’s and con’s. You can find it here > ‘Growth Through Acquisition.‘
Business growth can be daunting and really hard work, but once you get going, it can be very rewarding in the longer term. If you have any questions about how to finance or plan a growth route – please do contact me to have a no-obligation chat to see how I could help.