Many small business owners are now asking the question” in growing my business what will it bring?”
Surprisingly not every business owner wants to grow. Some after Covid are scaling back others are happy just to maintain the status quo. Today we are exploring what business growth means to you! Why grow and will it bring new headaches you don’t want?
Here is a quick summary of what growing your business may bring your business:
- More money
- Greater sales
- Bigger opportunities
- Larger profits
- More headaches
- Growing pains
- Or all of the above ??
The above are typical examples of why the small business owner considers business growth.
We all are aware of it, but why should I grow my business? Just because some business guru says, you have to grow to survive it always that simple?
We often get asked how do I grow my business. Our approach is, why do you need to grow your business and what are you trying to achieve. In our previous article, we talked about business goals.
It comes back to outcomes and planning. Again growing at all costs impacts the business and not always the way you think or would like. Growth for the sake of business growth isn’t a great outcome in many cases.
Examples of what business growth direction can impact!
As an exit planner specialist, we like to explore business outcomes. Let’s explore business growth and development in these typical examples
Business Growth and Profit loss
Bill and Jerry run a successful cake factory. They are already busy and Jerry over a long lunch landed a new order for supplying chocolate mud cakes to 50 supermarket statewide stores. The problem is that Jerry agreed to a delivery price which upon review has shallow margins. This has pushed supply to beyond capacity, and the overtime and freight charges have eaten into the profit. The outcome has been business growth and profit loss. Not a desirable outcome in short term. Bill and Jerry will need to look at how they restructure this aspect of the business moving forward.
Upgrading existing facilities to grow revenue and profit
Sally and John own a successful caravan park. After analysis, it became apparent that there are opportunities for high-quality cabins. Sacrificing a few powered sites for some new cabins has created a new, improved revenue stream and increased the park’s rating for tourists’ attraction. The tourist park has increased in value as well.
You will notice two different opportunities with two different outcomes. One was planned, the other was a punt. The punt resulted in losses but revenue growth. Bill and Jerry had no idea about this outcome.
Steps in the journey to business growth.
What are you trying to achieve with business growth?
- Increase business value
- Replace a product with a new one
- Grow to sell
- Grow by being more efficient
Look at what the bottom line and what will your growth plan do to achieve a financial result
What impact do want the growth to achive , greater revenue or an impact on net profit or both?
What period do you want growth to be achieved?
How quick do you acheive growth? Mark out how long will it take to get to your target of achieved business growth and what this means to your required capital needs , capacity and sales targets
What measures will you use to ensure you achieve your growth goals and who will be rewarded for its success?
Growth relies on the who business team . WHo is who and who will drive the growth strategy? Dont think it just happens. Work out who will make it happen and what needs to be done.
Gartly advisory and our team led by Geoff Gartly, love exploring helping small business to develop their pathway to business success. This summer, take time to plan your journey and may growth bring you happiness and allow your business to grow from small to big.
Geoff can be contacted at email@example.com if you would like to explore growth opportunities for your business.