11 Growth Strategies Which Will Take Your Business to the Next Level
Why Growth Strategies are Needed?
Whether you own a small business or a large business enterprise, in order to ensure its sustainability, you are required to create an iron-clad business growth strategy.
The most common reason for failure for new businesses within the first 3-5 years is the lack of good growth strategies.
Every business works towards some goals, and in order to achieve those goals, they need to design a growth strategy that is centered around the core vision of the business.
When businesses are in their initial stages, their success is dependent on the business plan they have created. However, sustaining that success over a longer period of time depends solely on how good your growth strategies are.
There will be roadblocks and bottlenecks along the way, and if you are to push through and take your business to the next level, you need to make sure that you have solid growth strategies in place.
The following section focuses on eleven different growth strategies that will take your business to the next level.
What is the Importance of a Good Growth Strategy?
Growth strategies play a massive role in the success or failure of a business. If you are running a growth-oriented business, you will always have the edge over your competitors.
You will be able to improve and expand your business continuously.
It will also help you build a great relationship with your customer base because a good growth strategy requires you to interact with your customers and find out their needs and wants and how you can fulfill those needs with your products and services.
Which Growth Strategies Should Small Businesses Employ?
When it comes to small businesses, it is important that they don’t try to do too many things at once. They should always start from the basics and try to build their way up. As a small business, it is better to start with your products and services.
Make sure that the products and services are catering to the needs and wants of the target audience and your audience is getting some value out of your propositions.
This will set you up to employ some of the more complex growth strategies like market penetration and diversification strategy.
1. Optimize Your Products and Services
For every business, their products and services are the main sources of their revenue generations and success. After a couple of years of successful operation, your business will likely notice a decline or lack of growth in sales rate.
To avoid this fate, you need to make sure that your products and services evolve with the market. They need to be improved from time to time to boost your sales.
For your business’s growth, you need to do market research to identify the gaps and areas of improvement for the products and services that you are offering.
Market research will give you an accurate idea of where you are lacking and where you stand compared to your competitors.
Businesses are required to have a proactive approach when it comes to positioning their products and services in the market among their competitors.
Bringing any new and unique features to your products and services that are not offered by any of your competitors can attract more customers, increase your sales, and win a large customer base.
Increased sales lead to increased profitability, which ultimately leads to business growth.
2. Leverage Your Core Competencies In New and Innovative Ways
Knowing your business’s core competencies is a preliminary step before you take on creating your business growth strategies.
It may come as a surprise for many businesses that not every business has a core competency on the basis of which they can differentiate from their competitors.
However, if you’re looking for continuous growth, a core competency is a must because it gives you a competitive edge by making your business stand out among your competitors.
It can be the unique features that you offer in your products and services; it can be quality or customer trust.
In the long run, you need to strengthen your core competencies to make sure that you maintain your competitive advantage over your competitors.
As long as you provide your customer with a product or service that your competitors can’t offer or replicate, you will enjoy a loyal and devoted customer base.
3. Strengthen Your Value Proposition and Make it More Attractive
A value proposition is a value that you promise your customer. It is considered as one of the most effective business growth strategies as it defines how much your customer values your products and services.
However, many businesses fail to come up with a good value proposition, which reduces the interest of new prospects in their products and services.
A value proposition needs to be relevant to your customer. It should give a precise explanation of how it can solve the customer’s problem.
It also needs to have a quantified value, which means it should identify how your product or service is going to benefit the customer.
Lastly, you need to tell the customer why you are the best option for them and why they should choose you over your competitors.
In order to create your value proposition, you need to indulge in getting to know the wants and needs of your customers and how to resolve their issues.
Only when you are aware of what your customers’ pain points are and what they are looking for will you be able to create a value proposition.
4. Expand and Diversify Distribution Channels
Most businesses are selling their products and services through traditional distributions channels. However, with every passing day, that is changing. Some of the most commonly known distribution channels are online, traditional shop/market, Social media platforms, partnership, and much more.
In order to expand your distribution channels, you need to explore new channels where your targeted audience is active and can be reached more effectively.
By increasing the distribution of your products and services into new regions, channels, and markets, you will see a boost in your sales, which will lead to higher business profitability and, ultimately, to business growth.
To analyze the effectiveness of expanding distribution channels, you need to look at the statistics (Datasheets and graphs) to help you identify the channels that require new marketing strategies to engage and reach more customers.
Expanding distribution channels will also improve brand/business recognition, which will bring in more customers.
5. Serve Underfulfilled Customer Needs
No matter how successfully and flawlessly your business is running, there will always be some areas that you could improve.
Identifying your customers’ needs and wants through surveys, customer feedback, face-to-face interactions, or social media engagement can help you understand where you are lacking and what areas can be improved to improve your customer experience and appease your customers.
Performing an analysis through these sources can not only make it easier for you to bring improvements in your products and services, but it will also provide a clear image of your position in the market among your competitors.
Once you get an accurate understanding of your customers’ wants and needs, you can base your business model around them, ultimately resulting in your business’ success.
6. Enhance Your Product Offering
There’s no doubt that the market is full of opportunities for every business in the world. After a few years of operating successfully, many business owners feel the need to work on a market expansion strategy for the purpose of business growth because without finding a new market or developing new products for the current market, it is virtually impossible to grow your business.
The market expansion strategy can be helpful in the form of product expansion or new product development. If you have successfully identified your customers’ needs and wants, you can easily develop new products or expand.
Some small businesses use product expansion as a growth strategy by expanding the existing product line to cover the market’s bigger share.
In contrast, large businesses can perform multiple expansions and can develop new products as they have greater financial margins at their disposal.
In order to operate successfully with high revenue generations, you can add new features to the existing products, expand the product line, or develop new products to tap into a new market and a different customer base.
7. Focus on Customer Benefits
If you want your business to grow, you need to make sure that your products and services benefit your customers in some way.
This means that you need to make your customers the focus of your business planning. You must be aware of what they are looking for, their problems and pain points, and how your services can provide them with a solution.
Make sure that your products and services are benefiting your customers directly or indirectly. Plus, your proposition needs to be relevant to your customer base so that your customers buy your products based on that.
If the main focus of all your products and services is to benefit the customer, you will rapidly grow your business.
8. Adjust Your Pricing
Market penetration is a process through which you can statistically analyze the size of market share your business owns with respect to the potential market.
Once you know the size of market share, you can create your business expansion strategy for growth and acquisition of a larger portion of the potential market, which results in increased customer conversion rates and higher profits.
When you’re dealing with stronger competitors, you can increase your sales by reducing the prices of your products and services to attract customers.
You can look for multiple options to reduce the actual cost of your products and services without affecting the quality.
Offering your products and services at a price lower than your competitors will have a magnetic effect on new and old customers. A higher customer rate will ultimately lead to improved profits and business growth.
At the same time, for your premium products, which have higher markup, you can increase your pricing and position the change as the result of you making additional investments into your products.
As a result of both pricing strategies, your profits will increase.
9. Accept More Risk
A diversification strategy is a high-risk business growth strategy, but if it’s successful, then your business will grow by leaps and bounds.
A diversification strategy is no child’s play; you have to conduct market research to create new products, identify your new targeted customers, identify their needs and wants, identify your competitors, and much more.
As entering a new market for any business needs a lot of work and capital, not every business can do it.
If you successfully create new products or services that align with your customers’ requirements and are unique compared to your competitors, you will see your business grow within a matter of months.
10. Consider Merger & Acquisition, or Partnership
When you enter the market as a small business, there are going to be many existing competitors who have been around way longer than you. Such businesses can make it very difficult for you to compete in the market.
Most small or large businesses use mergers and acquisitions as a growth strategy. Businesses look for their weaker competitors in the market and offer them a merger or acquisition, keeping in view some of the core competencies that can be developed stronger later on.
This is a win-win situation for both businesses.
This strategy not only helps your business to expand its business operations but also contributes to reducing the competition in the potential market.
At the time of a merger, businesses should be careful about how they will integrate their operations that will help them achieve their business goals. Also, while acquiring a business, your vision must be very clear about what you need to achieve through this investment.
11. Franchise Your Idea, Product, or Service
If your business is limited to a specific region while the potential market is greater than your business’s current operational market, working on a franchising model can be applied as a growth strategy.
Franchising will grow your business operations, existences, and awareness among its targeted market.
This strategy can be somewhat risky and complex, but it’s very effective if you want to cover the bigger portion of your potential market and generate higher revenues.
Most of the successful businesses worldwide have worked on this model as a growth strategy and gained higher profits over time.
No matter if you are a small business or if you are a large enterprise, you can use the growth strategies above to improve your profitability and scale up your business.
Any of the growth strategies may not be implemented overnight; therefore, it is necessary for you to consider your next steps, conduct thorough research carefully, and, based on the evidence – make some adjustments that will undoubtedly lead you to improved profitability and business growth.
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About the Author
Eugen Spivak is a multi-award-winning author, business strategist, and a business coach. Eugen is the founder of the Canadian Institute of International Business, an organization dedicated to bringing practical and hands-on business education for modern business leaders.