Why Does Your Business Need to Grow?
When the health and value of your business are assessed, growth is one of the most important metrics, but why? Why is growth such a vital indicator of success for a business, and why do you need to plan for growth and development, not simply ‘cruising’ at the first stable altitude you attain?
Business growth is a priority that will drive new product development, inform your hiring practices and enable you to gain more funding, so it’s important that you answer these questions to your satisfaction. That’s what we’re going to try and do today.
The immediate and tempting lure of expanding your business is that it brings you more money. If you grow your business, by hiring more staff, by opening new locations or even by spreading abroad, you open yourself up to more customers and therefore more money! If you’re opening in new locations, you can expect a faster evolution from just starting out to stable, profitable business as you can apply the lessons you learned the first time around.
You need to ensure you combine your own experience with market research, to ensure your expansion planning is tailored to your new location and market, and the demand that you expect exists there is reflected in reality.
If you budget carefully, this kind of expansion can see you earning more money, and growing even more, in a virtuous circle that will bring you long term success.
More important than revenue, though, is the stability that carefully planned growth can bring you.
When you first start out as a business, you’ll be reliant on one or two stand out products or services to attract customers, or perhaps a few small but high paying initial clients. While this will pay the bills and help you get established, if those clients move on or close down, or trends move customers away from the limited number of products you offer, then your revenue stream dries up.
If you grow, offering a wider range of products, or reaching a greater number of people spread across a larger area, you make yourself less vulnerable to these single dramatic changes. If one product loses its appeal, you have others to rely on while you broaden your range and bring those customers back. If one big client goes elsewhere, you have others ready to pay!