“If you fail to plan, you are planning to fail.” A famous quote by Benjamin Franklin sheds light to the fact that 50% of small business startups fail before they reach the five-year mark. And while there are a number of factors that could account for this, failing to plan and implement a long term business growth strategy is certainly near the top.
No entrepreneur sets out to start a business that will merely survive; the goal is to build a business that will thrive and grow year after year. Yet many small-business owners operate under the impression that growth will come as a natural result of doing business as usual. Little do they realize that by not having a tangible growth strategy in place, they are not only not growing their business, they are actually losing business to their competitors.
As a small business owner, you might find yourself asking, “What is growth strategy?” You might even be wondering what a growth strategy business plan might look like. Here’s a list of deliberate steps you should take to get you on your way to developing a successful long term growth strategy business plan.
In today’s competitive business arena, you need to understand what your small business has to offer, in terms of a product or service. What is it that sets you apart from the competition? Start by asking yourself what makes your business unique, relevant, and credible. If you can’t answer that question for yourself, you can bet that your potential customers won’t know why they should trust their business to you either. Once you establish what your value proposition is—that special benefit that only your business can provide—you will have discovered the one critical, organic growth strategy on which to build everything else.
If your value proposition is service-centered, focus on making that service better for the customer. If it’s centered on a unique product, then your product-growth strategy should be focused on making that product even better. When you’ve got a quality product, you can focus with confidence on a growth-strategy market penetration plan to get your unique product in front of more potential customers.
You started your company because you saw a unique solution to a problem. But that problem generally relates to a certain audience, and that’s the audience you want to focus your marketing efforts on. To formulate an effective growth-strategy in marketing, it’s critical to identify exactly who that target audience is, and who among that audience is your ideal customer. Armed with this information you can better adjust your business in ways that will stimulate steady growth. For example, developing new products to better serve new and existing customers is a powerful growth strategy that can only come from knowing who your customers really are, and what they are looking for.
Once you’ve identified your target audience, the next step is to provide them with something of value. Of course, the product or service that you offer should fit this description. Many potential clients will hesitate to commit to a purchase before experiencing that value for themselves. Businesses that engage in content marketing, where high-quality, useful content is shared via digital channels free of charge often find that the goodwill generated leads directly to increased sales. According to study by Demand Gen, 66% of buyers agreed that the winning vendor provided higher-quality content, and 63% said the winning vendor’s content was more conducive to building a business case for the purchase.
When the money finally starts coming in, many entrepreneurs assume that their revenue stream(s) will sustain their businesses in the long run. But as competition increases, and the needs, wants, and attitudes of customers change, those reliable streams of income can eventually become obsolete. In order to carry out a successful growth strategy in small business, it’s imperative for business owners to identify those products and services that are bringing in the most revenue, and then look for ways to make those streams solid and sustainable. In the process, new revenue streams, can potentially reveal themselves, that can be added to make the business more profitable. Understanding revenue streams, especially how they relate to expenses, is shown to lead to higher profits; inbound marketers who measure ROI are more than 12 times more likely to be generating a greater as opposed to lower year-over-year return.
Once put into place, growth strategies must be analyzed to determine their effectiveness in actually building long-term business growth. When changes are implemented to stimulate growth, those changes must be measured for effectiveness. Through the analysis process, key indicators can be identified that are actually affecting the growth of the business. Thus entrepreneurs can focus their time, energy, and money on the strategies that are working to build their businesses, while eliminating those that aren’t.
Another important aspect of growth strategy analysis is figuring out what the competition is doing to grow their businesses. Identifying the new and unique ways that businesses similar to yours are growing can help you to better strategize your own plans for growth—to not just keep up with, but to outperform, the competition.
While Franklin’s advice, “If you fail to plan, you are planning to fail,” readily applies to small business entrepreneurs, another caveat is just as crucial: if you fail to manage your growth strategy on an ongoing basis, your business will probably not live to see its five-year anniversary. Once implemented, long-term growth strategies must be managed, monitored, tweaked, and revised in order to produce not just long-term survival, but increased growth and profitability.
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