All small businesses start out aiming to experience growth. But what does business growth mean and how can you achieve it?
Read our in-depth guide to business development to find out more about growth strategies, how to develop a business growth plan, and the different stages of business growth.
What is business growth?
Developing a business can be achieved in a range of ways from expanding your team or increasing sales figures, to launching new products or moving to new premises.
Growth businesses are in a strong position to attract the best talent, appeal to investors, and innovate to take advantage of new opportunities.
What is organic growth in business?
Organic growth is when your business expands without making radical changes.
For example, the longer you’re in the same market, your reputation could start to grow and lead to more sales. Recruiting new staff or receiving investment can also lead to organic growth.
How to develop business growth strategies
If you’re actively looking to grow your business, you’ll need to develop a business development strategy.
Business growth strategies include deliberate actions that change the way your business operates.
Here are some examples of the most common strategies:
diversification – selling new products or services to a different market can provide extra revenue streams
product development – launching a new product or improving an existing product can help a business to sell more to their existing audience
increasing market share – also known as market penetration, this is when a business increases promotion of its existing product or service to the same market
partnerships – teaming up with another company could help a business to increase resources and expand its target audience
new channels/tactics – also known as market development, this is when businesses use new marketing methods and launch in new markets to get their existing products in front of a fresh audience
Do you need a business growth plan?
A business growth plan is similar to a standard business plan.
The main difference is that it covers a shorter period of time, usually one to two years, rather than three to five years.
So, how do you start business development planning? Firstly, you’ll need to assess what stage your business is currently in (see below) and monitor performance. A good way to do this is by completing a SWOT analysis, which is a deep dive into your strengths, weaknesses, opportunities, and threats.
Next, you’ll need to create a plan for how you want your business to grow and identify the goals that’ll help you reach the next stage.
What to include in a growth plan
It’s important to break your growth plan down into sections, with clear objectives you want to achieve. Here are some of the key areas covered in most growth plans:
growth strategies – which growth strategies are you going to use to reach your objectives? Are you looking to partner with other companies, or diversify your service?
operations – do you need to move to new business premises? Are there new suppliers you need to work with to reach your growth goals?
people – does your business need more staff to grow quickly? Outlining the staff structure of your company and making sure the right people are in the right roles is key to future success
What are the stages of business growth?
When reading about business development, you’ll often come across the stages of growth. These stages outline the life cycle of a business so it’s important to know which stage your business is in.
We’ve put together an overview of the main stages below. It’s important to note that you’ll often see the stages described in slightly different ways with different names.
**Launch** – the start of the business. Sales will be slow and you may still be developing your product or service. You’ll need a big marketing push, with a focus on getting your name in front of your target audience.
**Growth** – your initial efforts will start to pay off with a surge in sales. This can lead to better cash flow and profitability.
**Expansion** – this is when many businesses go to the next level, by either moving to bigger premises, hiring more staff, or launching in new areas.
**Maturity** – during this stage, business will become more steady and predictable. New competitors are more likely to enter the market, and it may become harder to grow. This is when businesses need to innovate or diversify to remain successful.
**Decline** – those businesses that don’t successfully navigate the challenges of the maturity stage could struggle, lose market share, and eventually become unviable.
Business growth grants – what do you need to know?
A business growth grant is a cash injection that doesn’t need to be paid back.
In the UK, there are a range of growth grants available for small businesses, as well as grants for young business people, and businesses that take on apprentices.
Read our guide to small business grants for everything you need to know.
If you’re looking for another type of investment, read the following guides to get started:
How does the Business growth fund work?
The Business Growth Fund invests in small and medium-sized businesses across the UK and Ireland. It was set up in 2011 by a range of banks, including Lloyds, Barclays, and HSBC.
The fund has invested more than £2.5 billion in around 300 companies. It usually becomes a minority, non-controlling stakeholder in the businesses it invests in.
What is a growth mindset in business?
Growth mindset is an academic term that has become popular in business. It’s a belief that either your professional skills, or your business itself, can be improved through hard work and dedication.
It’s the opposite of a ‘fixed’ mindset, where you believe your business is limited by the skills and talents your employees already have.
The aim of having a growth mindset is that by focusing on learning and development, a business can thrive through innovation and new ideas.
However, declaring that your business or employees have a growth mindset won’t have an impact. You’ll need to be committed to changing the way your business operates from top to bottom.
Here are some of the qualities of a growth mindset in business:
making sure everyone is accountable
focusing on the purpose of your business
prioritising learning and research
learning not to dwell on failures and mistakes
working towards long-term goals
What are your top tips for developing a business? Let us know in the comments below.
Photograph 1: Gorodenkoff/stock.adobe.com
Photograph 2: murattellioglu/stock.adobe.com