When launching a new business, the main objective will always be growing your brand and establishing your place on the market. Unfortunately, many people think achieving business growth is something you can obtain overnight with a magic formula. Still, the reality is very much the opposite: growth strategies will be different for each kind of business and will require work. However, this article will help you understand the basics of growing a business, its types, and stages, which you can then apply and adapt to your business growth plan.
What is Business Growth?
Business growth is, in short, when your business’ success increases. This can occur for several reasons and can be perceived through increases in revenue, an expansion in client base, or higher product production. Growth is an instance of the business lifecycle and can depend on industry growth trends, decisions made by leadership, or external factors.
Business growth is, in short, when your business’ success increases
Types of business growth
There are four types of business growth: organic, strategic, internal, and partnership or acquisition.
Organic growth is considered the easiest method for growth and can be observable through new products or service launches or new business front openings. However, although important, organic growth strategies are not sustainable in the long run.
Different from organic growth, strategic growth focuses on the long term. Planned growth stems from marketing strategies, product launches, etc. It is excellent to approach strategic growth ideas once your organic growth stage is over.
Internal business growth
This type of growth looks in rather than out, intending to use and optimize the already available resources. Instead of investing in new resources, the idea is to learn how to use the available ones more sustainably.
Partnership or acquisition growth
This is an option many small businesses choose and view as a form of growth. It is both the riskiest growth strategy and the one with the highest potential for success. A partnership or acquisition allows expansion from both a market and a production perspective.
Business growth stages
There are considered to be five shared stages of growth for small businesses. Of course, they will be different for each business, but there are common aspects that make these stages generalized:
Stage I: Existence
Your main problem is obtaining a client base and managing to deliver your service or product successfully. Existence stage businesses range from new restaurants or stores to manufacturers who haven’t stabilized their production process yet.
Stage II: Survival
When reaching this stage, you’ve proven your business works, and you need to figure out your expense-revenue relationship. Think of businesses in the survival stage as local shops, or manufacturers that cannot sell their products as much as planned.
Stage III: Success
Your business plan worked. Now what? This stage finds business owners wondering whether to attempt expansion or play it safe and keep doing what they’ve been doing.
Stage IV: Take-off
If you choose to expand your business and are seeing it grow, the take-off stage will be the moment when you figure out how to hurry that growth plan and how to finance it.
Stage V: Resource Maturity
The final stage of business growth means your business has the stability and financial resources to allow operational and strategic planning. The main concerns during this stage are establishing and controlling your revenue gains while maintaining the benefits of a small business.