Stage 5: EXPANDING MY BUSINESS
The journey of a thousand miles begins with a single step. Lao Tzu
Expansion is the most commonly used strategy in business. It entails increased sales, assets, and net profit, as well as the ability to use the experience curve to reduce the unit cost of products sold, resulting in higher profits. A growing company has the ability to expand in a variety of ways. Employees profit from improved earnings and promotions as a result of the company's success. Customers gain access to new goods and services. Increased profit opportunity, benefits owners. The new jobs that are produced support society. While it is very rewarding, managing this expansion, will challenge your skills and financial capital.
When a business owner anticipates future growth, the enthusiasm and challenges frequently divert the owner's attention away from the financial aspects of the business. There are numerous examples in business history about businesses that achieved growth but were unable to maintain their new position, often due to a lack of attention to managing the finances that support growth. In new and expanding companies, successfully managing financial resources is critical, so spend time developing and implementing a financial plan that will ensure your company's success. A well-written, detailed financial management plan that clearly outlines the company's assets, obligations, and current and future profit potential is required.
There are many strategies to promote business growth, and the best approach for your company will be determined by the type of business you own and the amount of time and resources you have to devote to its expansion. Here are some methods for expanding your company that you might consider:
Increasing the Number of Locations and Employees in Your Company
- Consider establishing a second location in a different neighborhood
- Consider franchising your company
- Combine locations with an existing business
- Hire more employees to better serve your current customers
Increasing Your Business Diversification
- Promote complementary products or services
- Offer tours and workshops at your business place
- Consider exporting the products to other countries
- Target additional potential markets, such as the online market
- Engage your customers through social media
Collaboration with other Companies and Organizations
- Create a partnership with an existing company
- Submit a proposal for a government contract
- Consider obtaining a license for your company's product(s)
Since not every growth strategy is appropriate for every business, the challenge of determining which growth strategy is best suited to the company and its particular market can only be overcome by visionary business strategists.