Businesses can be likened to a seed (in the form of an idea) which, when planted (executed properly), grows into a tree (a company). Trees come in different sizes and produce different yields of fruits, and so do businesses. As an entrepreneur, it is normal to desire (like a farmer) for your tree to grow bigger or to have more than one of that tree; the aim is usually to be able to produce more fruits (more revenues and profits in this case).
In essence, business growth is simply a business seeking expansion and exploring opportunities to increase its sales, grow its revenue and also increase its market share. The desire for growth is innate in every entrepreneur, but not everyone knows how to go about it. In this article, we will be examining some growth strategies that you can explore to achieve your growth dreams.
4 Strategies for Growing Your Business
1. Penetrating your current market. Here, you think of how to reach more people in your current market with the same product/service you are offering. For instance, Mrs. A sells suits to female bankers in Lagos. She may begin to think of how to reach more female bankers in Lagos. Maybe she’ll need to open up more shops, or hire more salespeople, or try other marketing strategies.
2. Targeting new markets: Here, you start pushing your existing products/services to new markets (which can also include foreign markets). Back to our example; in this case, Mrs. A may decide she wants to start selling suits to female lawyers in Lagos.
3. Introducing new products/services: This one requires you to look more closely into the needs of your existing customers and find something else they need that you can start selling to them. Mrs. A may decide to add corporate shirts, shoes, and bags to her collection, strictly for female bankers in Lagos.
4. Diversifying your products and markets: This one is tougher because you are targeting new markets with new products. In this case, Mrs. A may decide to include selling corporate wears (new products) for male business executives in Lagos (new market).
Having noted these strategies, the next question is: How do you know which strategy to use for your business? How do you know which one will be profitable?
Finding Growth Opportunities for Your Business
Before deciding on what approach to take in growing your business, you need to know where there are potential opportunities for your business in your industry and market. The opportunities you identify will tell what strategy you need to deploy.
Now here are some ways to search for opportunities:
1. Analyse your customers’ needs. Think about your customers’ unmet needs (especially the ones you’d be uniquely positioned to meet).
2. Analyse your customer segmentation. Think about customer segments that share common characteristics with those you are already serving.
3. Analyse the customer journey. How do customers currently buy your products? Are there other channels you may use or formats you may present your products that will attract a new set of customers?
4. Analyse your competition. What is your competition offering that is having a significant effect on the market?
5. Analyse substitute industries. What alternative products/services are people who fall into your target market going after?
6. Analyse complementary products/services. What other companies’ products do customers get and use alongside your own?
7. Analyse trends in society. What changes are going on in the world around you, e.g technologically, that is birthing new lifestyles relating to your industry?
Creating a Roadmap for Growth
Growth comes with many challenges; and when not planned and prepared for, it can ruin a business. However, having a roadmap can properly guide your business and reduce your risk of failure as you grow.
Here’s what you need when creating a roadmap for growth:
1. An honest assessment of your business’ current state; your strengths, weaknesses, opportunities, etc;
2. A vision for your company, where you want it to be 5-10 years from now;
3. An action plan on how to take your company from where you are now to where you want to be; detailing what needs to be done, by who, and when it should be done.
It is possible to have a sketchy growth plan, or a detailed strategy plan (showing things like sales, financial, market share forecasts, etc).
Remember the old saying: ‘Failing to plan is planning to fail?’ I’ll like to add that a bad plan is better than no plan at all.
If you’re not sure how to go about this, send us a message and we can schedule a one-on-one strategy session for you to discuss and plan out your business growth.