Why Grow a Business?
Many small-sized business owners are faced with a critical decision at some point of their business’ life cycle—whether or not to grow the business. Sure, with growth comes added autonomy, the opportunity for additional revenues and income, and a greater potential for an eventual exit, among other benefits. Growing a business, however, also comes with it the added responsibilities of employees and locations to manage, operations and capacity to meet customer demand and orders, additional resource and investment allocation, the ability to sustain that level of activity, and added risk. So the questions quickly become “Is growing the business really in the best interest of the business owner?” “Is it worth it?” And, “What are the necessary steps to do it?” It is not as easy a decision as many might think…
When to Grow a Business?
The time to grow or expand your business can come at various points in the business life cycle. It might be clearly apparent or something that just ‘seems right’ and sequential. Or, the opportunity to grow your business can present itself at a point that is most uncomfortable and less than ideal. Nonetheless, the right time and indication to grow a business can be summed up with the following equation:
Right time = Size of opportunity + Level of Risk + Ability/Capacity + Market
To grow biz & potential return Adverseness to Execute Conditions
How To Grow a Business
There are several ways to grow a business. Following are a few suggestions to consider:
- Diversify and/or develop new product or service offerings to gain a greater market share in your market space. Diversifying your product and/or service offering can be a great growth strategy for any business as it leverages your expertise and can tap into your customer base for fast turn-arounds to multiple income streams, while also satisfying seasonal voids. “Small-business consultant McGuckin offers several ideas for diversifying your product or service line: Sell complementary products or services; Teach adult education or other types of classes; Import or export yours or others’ product; Become a paid speaker or columnist” 1
- Generate more customers. Increase your marketing and sales efforts. This is a pretty obvious one. The song goes something like this: More marketing equals more sales. More sales equals more customers (and opportunities for profitable relationships). More customers and opportunities for profitable relationships equals more business. More business equals growth. Pretty simple, right? Not always…
- Open another location. This, too, is an obvious choice for increasing a ‘brick & mortar’ business. It makes best sense if the new location can leverage existing economies of scale, your expertise and/or existing infrastructure and reach a new audience by area. Remember to choose a location that best for your business and not yourself. And, be sure to do your homework on the quantity and quality of foot traffic (potential customers) of the new location.
- Expand into other markets. Consider branching out to reach areas such as special interest clubs and/or groups where your current audience spends the majority of their time. Look at different demographic profiles that your product and/or service can support with a simple product/service tweak and/or marketing message.
- Merge with or acquire another business. Sometimes merging or acquiring a competing or complimenting business is the best and fastest way to business growth. Usually economies of scale in terms of employees, operations and output combined with additional customers, offerings and/or brand equity could amount to higher revenues at better margins.
- Leverage the Internet and/or Go Global. There could be ways to grow your business and expand to far reaching locations and audiences, efficiently using the Internet. Look at similar businesses and their reach. Learn more about social media, search engine optimization and their potential impact in relation to your cost of sales to get a sense if this is an opportunity for your business. You could be close to generating efficient orders that you hadn’t thought of yet.
Growing your business, as mentioned earlier, is not easy. Following are some quotes from business leaders regarding the topic for inspiration and advice…2
Boston Chicken’s George Naddaff: “Welcome Challenges”
Amazon’s Jeff Bezos: “Follow Your Passions”
Sam Adams’ Jim Koch: “Patience Is a Virtue”
iVillage’s Candice Carpenter: “Do What’s Manageable”
Apple’s John Sculley: “Don’t Be Afraid to Make Tough Decisions”
- Entrepreneur “10 Ways to Grow Your Business by Karen Spaeder, July 19, 2010.
- The In’s and Out’s of Growing a Business,” from Inc magazine (http://www.inc.com/ss/ins-and-outs-growing-business#9)
About the Author
Angelo Biasi is General Manager of SMART Marketing Solutions, LLC, a leading full-service integrated marketing company in Florida and New York since 2001. He has helped create and execute marketing plans and integrated marketing solutions for companies such as Playtex, Bic, Rogaine, Tauck, and over 35 colleges and universities, to name a few. Angelo has an MBA in Marketing from the University of Connecticut and teaches Marketing at New York University where he has for over six years. He has been quoted and/or featured in USA Today, Mobile Marketer magazine, Mobile Commerce Daily, Luxury Marketing magazine, BNET TV and Business Currents magazine, to name a few. For more information or to learn more, email him at abiasismartmarketingllccom (abiasismartmarketingllccom) , visit www.smartmarketingllc.com, call him at 239.963.9396 and follow him on Twitter @angbiasi.