For the first few years of operation, the majority of companies are focused just on surviving. However, it’s important to recognize that the growth of your company is one of the best ways to make sure that your business won’t only succeed but also provide you and your employees with financial stability.
In order to scale a business, it’s important that you always keep that thought in mind. From the first day of running your company, you should be thinking about the different ways that you could potentially scale up. Eventually, your company may become big enough where you can ally and even merge with other companies.
So what can you actually do to get your company past the point of just barely surviving? And how can you transform it into the money-making powerhouse that you envision?
As with all other facets of running a business, there are a variety of growth strategies that you can try out. So continue reading and we’ll walk you through how you can scale your business.
Find Your Niche
Many big businesses tend to appeal to general, wide customer bases. Because of this, customers who have more specific needs are typically left out. Those big companies don’t see enough profit potential for them to serve those customers’ needs.
With that said, a smaller business could be perfectly positioned to meet the demands and desires of those customers. It’s important to realize that a big business might not actually be direct competition to you.
Ask yourself how you’re different and focus on the niche that lets you play to your strengths and develop customer loyalty and market experience.
If you start out too diversified, then you may end up spreading yourself out too thin. Instead, consider starting small but specific. You should operate with a strategy in mind of how you can eventually expand or even pivot as market trends evolve.
Recapture Existing Customers
Attracting new customers isn’t the only way to scale your business. A lot of the time, the clients who you already serve are your best chance for boosting your sales. Improving your customer retention rates will also help to improve the value of your business.
A client who has already bought a product or service from you is more likely to do so again. And this is especially true if they had a positive customer service experience.
Make sure that you get the shopping preferences and contact information of one-time customers. You can then use that information to set up marketing systems that are going to turn those one-time customers into returning customers.
By using a mix of strategies to acquire new customers and retain old ones, you’ll have a powerful way to grow your business.
Ask for Referrals
As we already stated, focusing on a niche service is an effective way to attract new customers. Another great strategy is to reach out to your current clients for referrals.
These customers are already your target audience. That means that their work and social networks are likely also going to be within your target market. This makes your current customers a helpful access point to new customers.
With that said, you can’t just simply assume or hope that your current customers are going to tell their friends about how great your business is. Instead, you should ask your satisfied clients if they know anyone else who’d be interested in the services or products that your company offers.
You can also use a discount code in order to incentivize referrals and encourage your customers to share and tag your brand on their social media accounts.
Contain Your Costs
One of the most important steps to growing your business is increasing your bottom line. If you’re able to grab more share of the market but you also continue to spend more money, then you won’t have enough cash to invest back into your business or to actually become profitable.
Because of this, you should be looking at the costs associated with operating your company while also trying to figure out how to grow. Pay attention to how much it costs you to get your services or products to your customers. By lowering these costs, you can make sure that your company has the cash flow it needs to stabilize and grow.
There are two main strategies that can help you cut costs. First, you can consider improving your inventory turnover by employing new sales and marketing tactics. You can also get rid of the products and services that aren’t making you as much revenue as they should be.
When you’re cutting your costs, make sure that you don’t end up compromising employee satisfaction or customer service. Motivated employees and happy customers are both extremely important for growing one’s business.
If you cut costs in those areas, you’ll ultimately end up hurting your ability to expand your business, even if you end up with some extra cash flow in the short term.
Extend Your Market Reach
There are a variety of strategies that you can utilize in order to grow your business by making your services or products available to a new set of customers.
First, you can open stores in new areas. Remember, a new location can also be virtual. This can include a website with an online store, social media accounts, and more.
You can also target a new demographic. Now that you know your target audience, try to think about what other groups could also use your product in ways that are similar to your target demographic. After you’ve found a new market, you can advertise in ways that target that market.
Another useful strategy would be to encourage new uses for your product. Look at your products and services and try to see how else it can be used.
You want to encourage your customers to use your services in new ways so that they can continue to buy more. This can also help you attract new customers who might want to use your products for unique purposes.
All of these strategies are going to help you expand your share of the market. This won’t just boost your sales but it also provides you with a more stable business model.
You should never put all of your eggs in one basket and rely on just one kind of target customer. You’re more likely to survive a changing market by expanding your options.
Take Part in Trade Shows
Trade shows are more important than ever. By having a strong presence in these groups, you can grow your business and establish your company as a leader in your local industry.
Trade shows are great because they bring in people who are already interested in – and open to – the service or product that you have to offer. This will give you a chance to market directly to a big group of people who are guaranteed to be in your target market.
With trade shows, you also have the benefit of interacting in-person with customers. This will increase your ability to connect with people and convert them into possible buyers.
Another big benefit of going to trade shows is that you’re given the opportunity to network with other companies in your line of work. This presents new possibilities for collaborations and promotional campaigns.
When you work with other businesses, you can attract new customers, establish your credentials on a larger scale, and ultimately grow your business.
Diversify Your Products or Services
The best way to scale your business with diversification is by building on similarities. You can do one of two things in order to achieve this.
First, you can focus on services and products that are related to the ones that you already sell that cater to the needs of the clients that you already serve. Alternatively, you can focus on new market segments. These segments will still contain similar characteristics and needs of your current customers.
For example, a company that rents roller skates in the summer might switch to renting out ice skates in the winter. A filmmaker might also make video production content for small businesses. By implementing little changes over time, you can diversify your services and attract new clients without overextending your business.
Develop Franchising Opportunities
One of the most effective and well-known strategies for growing a business is through franchising. If your business is successful and you believe that you can design a system to make sure that you can replicate that success, then franchising might be a great choice for you.
Successful franchising strategies depend on having a brand that has broad appeal over a variety of geographical areas. You’ll also need a business model that easily be replicated.
In order to make a franchise, you have to license your business process, model, and branding to franchisees. These franchisees will then sell your branded services and products in their own location, under the same name as your company. This lets you expand your market reach to new areas, build your brand name recognition, and create new revenue streams from franchise locations and licenses.
Expand to Exporting
Another great way to boost the bottom line of your company could be by expanding into international territories. Similar to franchising, this is a method to grow your business by reaching out to new customers in diverse geographic areas. However, you’re also going to have to dedicate a lot of time and energy to operate in other countries.
First off, expanding to international locations can be legally complex. You’re going to have to deal with the restrictions of customs and trade rules across several countries. You also might need to get an export license, depending on what your service is and the country that you’re exporting to.
With that said, if you have the time, money, and energy, then exporting your product should let you grow into markets that were inaccessible previously. This can then provide you with big opportunities for growth.
Choose the Right Growth Strategy for Your Business
In order to figure out the appropriate scale strategy for your company, you’re first going to have to figure out what state your business is currently in. You also want to know what resources are currently at your disposal.
Think about what you have available to invest – such as personnel, expertise, time, and money. You should also think about the interests of your customers, your business goals, and your current market.
You should start by just picking one or two growth strategies that seem fitting for your business. Then, come up with a new business plan based on that strategy.
Set benchmarks for revenue, expenses, and growth. Finally, track these benchmarks, monitor your progress, and adjust your plan accordingly.
While you likely won’t experience significant growth right away, you’ll eventually see progress as long as you stick to your plan and track your progress. And if one strategy doesn’t work, then reevaluate the situation and try again.
You can also hire a business expert to help you expand your business even quicker. For more information, do some research and figure out what your business goals are.
The Importance of Knowing How to Scale a Business
As we can see, there’s a lot involved when it comes to growing your business. But by knowing how to scale a business, you can know how to expedite the whole process and grow your business effectively.
Are you looking for other helpful articles like this one? If so, make sure to check out the rest of our site today!