Assess your options for business growth
Importance of business growth
Growth is crucial to the long-term survival of a business. It makes it easier to acquire assets, attract new talent and fund investments. It also drives business performance and profit.
Why is growth in business important?
Growth can be good for business for many different reasons. For example, it may allow you to:
- take advantage of new opportunities
- expand your products or services
- attract more customers
- increase sales
- employ more staff
It may also help you to respond to market demand, allowing you to increase your market share and capitalise on your growing brand. It often spurs innovation, helping you to differentiate in the market and stave off competition.
Growth can also boost your business' credibility, allow you to broaden your supply base and increase stability and profits. However, to be successful and sustainable, growth has to be strategic and has to happen for the right reasons. Before taking any action to grow your business, you may want to consider is your business ready to grow.
Reasons for business growth
Most businesses grow to become bigger, perhaps through increasing sales or market share, but size isn't the only driver. Many other benefits motivate businesses to grow. For example:
- greater sustainability or resilience in the market
- lower costs - due to economies of scale
- greater market dominance
- greater buying and bargaining power
- ability to mitigate commercial risks - eg through diversification
- ability to reduce the threat of competition
- ability to survive market fluctuations and downturns
- ability to attract the best talent and staff
Growth may not be feasible or practical for all businesses but, in most cases, stagnating is likely to lead to missed opportunities. Discover the advantages and disadvantages of growing your business.
Deciding how to grow
There is no one way to grow a business. You may want to expand your service area, form business partnerships, launch new products in existing markets, diversify your existing product line or explore other business growth strategies.
Identifying the right growth opportunities will require a full understanding of how your business is currently performing. Evaluation can help you to identify current weaknesses and expose challenges and obstacles arising from growth.
See more on planning for business growth (video).