It’s dreamtime for small business owners: You start a new business. Fast forward ten years. It’s time for your industry’s annual conference. You’re one of the keynote speakers. It’s standing room only when it’s your turn to talk. People line up afterwards to pepper you with questions. “How do you do it?” “How can I make my business as successful as yours?”
Maybe in the future you flew to the conference on your private jet accompanied by a posse of assistants and security guards. Or perhaps you flew to the conference sitting in coach and arrived alone, unknown to the general public, but successful and respected by your peers.
Whether you dream of taking your company from 0 to Microsoft or from 0 to mid-sized and profitable, the best way to ensure that you achieve the success you want is to map out a strategy for growth. You shouldn’t do business looking only at the present. Your goal should be to achieve current as well as future success.
Let’s examine a few ways to focus your growth strategy.
Winning Growth Strategy #1: Focus on Competitors
Your competitors can be your greatest teachers when it comes to shaping the growth for your company. What are their strengths and weaknesses? This can give you ideas for how to structure your business and what to avoid. Look at their marketing strategies, suppliers, product quality, and more. You can put your company in a positive place for growth by emulating the best of your competitors and avoiding their mishaps.
To be successful, you want to find a niche market. You want to provide a product or service that no one else in your industry does and be the go-to person for customers. That’s also where your competitors come in handy. Do a thorough analysis of what your industry provides. Where are they lacking?
For example, say you have a dog grooming business: Gabby’s Grooming. Every poodle and akita that leaves your grooming table looks fantastic, but Gina, Gerry, and Garth all do good grooming jobs too. How do you stand out? Look at what they aren’t doing. If you become the sole Certified Canine Massage Therapist in town, customers will have a reason to choose you over your competitors (there really are animal massage therapy certifications available).
Winning Growth Strategy #2: Focus on Customers
Aside from your competitors, your greatest teachers will be your customers. Your goal should be to gain new customers and also to retain your current customers. It’s generally easier to keep current customers happy than to find new ones. Moreover, those happy current customers will likely get you new clients via word of mouth.
Keep your business flexible and pay attention to trends. That doesn’t necessarily mean switching from making cookies to kale chips. Rather, focus on your niche and adjust it to changing customer interests. Say your company is Darla’s Dog Bows. Pretty polka-dot and paisley bows will always be popular. But to get customers excited, you can focus on popular culture. Doctor-Who loving dog owners would adore TARDIS patterned bows. Musical fanatics would “not throw away their shot” to buy a Hamilton themed bow. If your company has the flexibility to take advantage of trends, you’ll give current customers a reason to buy something new from you and also draw in new buyers.
In addition to keeping up with trends, strong customer outreach will also help your business maintain and grow. You want an active online presence: Website, blog, email, and social media outreach. You want to use every media outlet that your customer base uses to make sure that you can reach them easily. Also, don’t forget about community outreach. Attending local events, volunteering, and appearing on local media. You want to be present and responsive. This will keep your current customers engaged and also help new people to find you.
Winning Growth Strategy #3: Focus on Partners
Another growth strategy is to acquire other companies. It can be risky to spend a lot of money acquiring a company that may or may not return its investment. Additionally, you don’t want to diversify so much that your business becomes unwieldy. But at times, acquiring companies can be a smart way to grow larger and stronger.
There are several ways to grow through acquisition. Let’s use Dharma’s Dog Candles as an example (candles for dogs really exist). You could grow horizontally by purchasing your competitor, Dave’s Dog Candles. This will get rid of a competitor, add additional resources and skills, and another customer base. You could also grow vertically. If you go vertically backwards, you can acquire a supplier. Dharma can buy a wax manufacturer. This will allow Dharma to cut the costs of supplies and increase the speed of production. If the manufacturer still sells wax to other candlemakers, it also offers a new revenue stream. Alternatively, you can go vertically forwards by acquiring a customer. Dharma can buy a pet accessories shop or a candle store. This way Dharma can gain revenue by selling products that she doesn’t produce as well as cutting off a retailer for her competitors.
An alternative to acquisition is partnership. It’s less risky than purchasing but still potentially very rewarding. Going back to Dharma’s Dog Candles, let’s say she enters into an exclusive partnership with Ellie’s Essential Oils to produce aromatherapy candles for dogs using Ellie’s Essential Oils (once again, these really exist). With a partnership, Dharma benefits from Ellie’s customer base, marketing efforts, and reputation. Assuming that Ellie’s Essential Oils is a large and respected business, Dharma also gets the cache of being special enough to be chosen by Ellie, which will lead customers to assume her candles are of superior quality to her competitors.
Every small business owner wants to stay in business and be successful. Success means different things to different people. Regardless, it’s crucial to your success to have a growth strategy in place from the very beginning. Focus on the future and the present will flourish.