Growth is important for any business. Growth means more customers, more revenue, more stability – the more you grow the less vulnerable you are to the loss of any single group of customers, any single shock or threat.
But it has to be the right kind of growth. Business strategy consulting experts will advise you on the models and kinds of growth that fit your business model and industry, but today we’re providing a quick overview to help you make informed decisions.
What’s Your Business Model?
There are many different kinds of business models, and one of the things that helps define each one is the sort of growth they suggest or encourage. Start-ups, along with an intense work culture, a small, tight knit team, and multiple rounds of substantial funding from investors come with an expectation and drive towards explosive periods of growth. Netflix, Uber, Whatsapp – all tech start-ups that began small and then achieved a dominant position seemingly overnight. If your product is a new tech development, an app or web service, this suggests the start-up and that explosive, overnight growth as the right models for you.
If the business you want to run is a local, bricks and mortar retail business, then you’re looking for a different kind of growth. A sustainable audience, build over time alongside your ability to service it at the same high level of quality. A huge explosion in orders overnight could be ruinous if you’re actually able to fulfil them!
The growth you try to create needs to be rooted in the character and structure of your business – and ultimately your aims for starting your own business. If you started your own business to escape the pressure and ratrace, there’s no point replicating that pressure in your own start-up!
When we talk about business growth, we often talk only about the sales side: revenue, footfall, impressions, clicks. Sold products.
It’s important to a business, but it’s not only the side to the growth equation. Alongside growing your sales capability, you need to grow your capacity to fulfil orders, provide services, and serve your own growing workforce.
If you’re running a retail business, growth means you need more storage space, more warehouse and fulfilment staff and more salespeople to go with the additional products on the shelves and the additional customers. As your staffing levels grow, the expectations of those staff grow – you’ll need full time HR staff to administer their needs and the complexity of payroll and holiday tracking goes up. For tech businesses, the same applies, but with server capacity and security taking the place of warehousing.
If you’re planning growth you need to anticipate how the needs of your business will change holistically, not just on the direct, money generating side and scale up in proportion, to ensure you’re delivering the service your customers expect.