So, you’ve decided it’s time to take your business to the next level, and start multiplying your profits. But is your company in an optimal position for fast, efficient business growth?
Building a business is one thing. Growing it beyond the million-dollar mark is another. Read on to learn how you can start positioning your business to boost your annual sales past your $1 Million plateau, and start experiencing true business growth!
Proven Methods to Successfully Grow Your Business
No two organizations are the same.
A tactic that works for one may not work for another, but there are a few strategies that are tried and true.
- Realize a unique problem and provide a solution. Find an industry or group of people who have a concern that is unique to them. Then put your energy into offering an innovative solution that is better than any other.
- Maintain a culture that retains a quality workforce. Even in a small organization, a toxic culture will not foster loyalty from staff. A passionate team whose vision is in line with leader is crucial.They must feel they are part of the company’s success and not just along for the ride. Additionally, invest your staff by providing the best training available.
- Have the right processes and systems in place. A seven-figure company can’t sustain itself without effective processes and systems.With the increasing scale of your organization, you will need to know how to outsource, delegate and hire teams to manage the daily operations. This will allow you to concentrate on the big picture.
- Keep sales at the forefront of your mind. Selling, in this context, goes beyond business development and lead generation.All stakeholders should make the most out of their list of contacts and continuously network. Consider instituting a bonus program that rewards staff for bringing revenue generating opportunities to the business.
- Concentrate on delivering value. Always ask yourself and other organizational leaders, “What value can be created for our clients?”A byproduct of this altruistic approach is being able to confidently invoice clients for what you are actually worth.
How to Grow Your Business the Right Way
Growing your business may be an intimidating process due to the high level of uncertainty involved. The following are issues you may want to consider before expanding your business:
- Understand that, even though growth may be necessary, it may not translate into increased sales.Ideally, you will already have additional sales firmly secured before the expansion.Create a sales forecast and conduct market research. You will want to consider the financial outlook for your specific industry and variations of the business cycle.
- If the expansion of your business means changing geographic locations to take advantage of favorable tax incentives, you may lose some of the customers you currently have.As you inform customers of the new location, you may incur unexpected advertising costs. Brainstorm potential expenses related to the move such as:
- Moving costs
- The cost of leasing a new space
- Renovation expenditures for the new space
- The hiring of new staff
- Acquiring new furniture and office equipment
- Property taxes
- Increased utility bills
- Determine if you need additional financing. The growth of your business may require an infusion of capital if it doesn’t already have the adequate amount of retained earnings needed for the expansion.Financial institutions and lenders provide business loans on the perception their customer can repay the loan.If your company is established and has a solid foundation of paying back the money it was given, it will be easier to secure financing than when you first started.If you have the intention of incorporating your business as part of the growth plan or your company is already incorporated, you will have the option of using equity financing.
This is the process of generating capital through the sale of shares in a company to raise funds. Shares are commonly purchased by angel investors who can be wealthy individuals, friends or family.
Regardless of whether you decide upon debt or equity financing, you will need to update your business plan with clear descriptions that will reveal to lenders that the growth of your business will be profitable.
- Ensure you have qualified staff who are engaged and have the continuous improvement of the business in mind.One of the key challenges to any business owner who wants to maintain their existing business or expand is acquiring staff who are qualified.
Unfortunately, people with certain skills, such as information technology expertise, are always in demand.If you are unable to hire them or keep them on staff, you will repeatedly have to train new hires which takes a significant amount of time and money.
Part-time employees or contractors may fill in the gaps, but they probably won’t have the long-term best interests of the company in mind.
Assuming employees can be retained, acquiring or merging with an existing business may be the solution to any hiring woes.
If your organization was originally formed as a sole proprietorship, you may want to strongly consider changing the legal structure to a corporation if you need to hire additional payroll employees.
This is to reduce the level of liability you will face as the owner.
If you make the decision to grow your business by forming a partnership, it’s a great idea to keep in mind not everyone will have the continuous improvement of the organization in mind.
Almost 70% of business partnerships fail which is higher than the rate of divorce in the United States.
The Advantages of Growing Your Business
Eventually, almost all business owners who are considered successful must decide whether to expand their organization to address new opportunities for growth or to stay at their current level.
If a business leader concludes it’s best for the company to stay at its current level, it may be due to a lack of staff, time, money or other resources.
But if the conclusion is made in favor of growth, research and planning
There are two main reasons for growing your business. The first is increase not only revenue, but profits.
However, earnings may not be your primary reason for starting your own business which leads to the second reason for organizational growth.
You want your product or service to help more people. Or you may want your organization to be listed among America’s most generous companies
Regardless of the motivation, there are definite advantages to growing your business which may include:
- Favorable exposure to a wider array of lenders
- Acquisition of financing at a lower cost
- Cost reduction because of increased production (economies of scale)
- Expanding into new lines of products
- Broadening your consumer base
- Becoming a publicly traded company so stakeholders may recoup their investment
It’s vital that you compare the total amount of variable and fixed costs with the projected level of sales volume to determine if the expansion of your business will offer a return on your investment.
National’s Growth Advisors Can Help!
Need help getting started? Learn how we can help you grow your business by calling (877) 482-3008 today for a free consultation with an expert business advisor.
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