If you’re a business owner, you always need to be thinking about growth – this is true whatever the size of your business. It’s not something you get to relax about when you reach a certain level. If you’re not looking for opportunities to expand, then those opportunities will be seized on by your competitors and who may use them to speed past you!
But in an age when rapid scaling and fast growth has become the dominant business model, it becomes a radical question to ask if growth is always the right choice for your business. Today we’re taking a look at some of the issues around growing your business that you have to consider when you’re deciding whether growth is the right choice for you and making a business growth plan.
One of the things that’s important in building and maintaining a brand – especially in the early years of a business – is providing a consistent experience for your customers. You need to be known as the people that do your thing, and do it well, whether that thing is selling fridges, painting nails or designing logos.
If you seize on any opportunity to grow revenue that you see, you run the risk of undermining that consistency and undoing the brand building work that takes months to create a strong, lasting impression. If that specialist fridge retailer adds some completely unrelated products to it’s offering to try and attract new customers, simply because it’s possible to get hold of them cheaply, it undermines the identity of the business and makes it harder for customers to recommend or choose it for themselves!
This applies not just to products but to pricing structures. If your nail bar is initially presented as a luxury, upscale business, a treat that’s worth spending money on, trying to radically increase footfall by dropping prices might drive away those original loyal customers who are enjoying an exclusive treat with no guarantee you’ll replace the revenue!
Try to make sure you know what customers value about your business, do some basic market research – even if it’s just handing out a questionnaire at the till or via email, it’ll help you understand why your customers like you and what made them take that initial step. You can assess growth opportunities by looking at how they help you lean into that image or if they would undermine it.
Growth takes the investment of money and time, and both of those things mean risk. You can access money by taking it out of your own (or business’ own) savings, by looking for a loan or by seeking new investment – but each of those has risks. Taking from your own capital means undermining the stability of your business in emergencies, taking a loan means taking on debt and investment means giving away a portion of your authority and decision making power!
Using your time overseeing growth means you have less time to run the already existing portions of your business – and they need to remain successful to keep your business stable while the new areas come into their own!
If your decisions about how to grow the business are wrong, whether it’s opening a new shop or adding a new product you could find it overbalances your existing business as well.
Use expert help to set some tests to help you understand if your business is ready to grow. Sometimes being risk-averse is helpful for a business that wants to survive into the long term – especially when you’re starting out, without much capital of your own and a barely built brand, risks to your business can be existential in scope!