If you are ready to grow, expansion and innovation require proper planning, allocation of resources, and a positive attitude, no matter the size or stage of your business.
Explore the essential aspects of growth and innovation. This will equip you with the necessary insights to self-assess and determine if you and your business are prepared for expansion.
Whether you’re developing new products, expanding into new markets, or creating innovative business models, strategic growth can result in significant financial and personal benefits.
It’s crucial to be prepared for any challenges that may arise. Take into account your strategy, market position, and capabilities when assessing if you are ready to grow your business.
Why grow?
Business owners and sole traders who strategically expand their operations:
- enhance their profits and sales
- stay relevant
- outperform their competitors
- increase their chances of long-term survival.
There are several government-backed programs and funding opportunities available to assist you in scaling up your business.
Government grants for established businesses
Planning to grow
Focus on what you aim to achieve and why it matters.
Establish goals that are:
- Specific: Clearly define what you want to accomplish.
- Measurable: Ensure you can track progress and measure results.
- Achievable: Develop a plan with a realistic chance of success.
- Relevant: Ensure your goals align with your overall strategy.
- Time-limited: Work towards a deadline to maintain focus and stay on track.
The next stage involves identifying the strategies and tactics that can be employed to reach your goals.
Common growth strategies
Collaborate with advisors to determine which growth strategy is most suitable for your circumstances as each has its own set of potential risks and rewards—and continue to seek their guidance as your business expands. Having a support network will assist you in achieving better outcomes.
Types of growth strategy:
- Product development: Developing new products and services for established markets.
- Market penetration: Increasing sales of current products and services within established markets.
- Market development: Selling existing products and services to new markets, eg to different parts of New Zealand or to export.
- Diversification: Developing new products and services to new markets, eg to different parts of New Zealand or to export.
How business advisors can help
Tip
Prepare for both success and failure.
A well-rounded growth plan encompasses key performance indicators (KPIs) and contingency measures.
Realities of growth
When you take your business to places it’s never been before, you’ll encounter challenges.
Common realities of a growth spurt include:
- Increased costs and expenses—keep an eye on your cash flow. You may operate at a loss for a while. Have a chat with your accountant to plan for this and find ways to get back on track.
- A significant change in your current systems and structures—or the need to establish new systems and structures.
- Competing priorities.
- A shift in your company culture.
- Realising the need to hire new staff or provide training to existing employees to meet growing demands.
- Compare growth to driving up a steep hill in a manual car. The effort you invest upfront may not yield immediate results. However, if you stay on track, you’ll gradually gain momentum and speed over time.
Tip
If your business is experiencing rapid growth, it’s worth considering establishing a board for support and advice.
Boards can offer you the high-level support necessary to achieve your full potential.
Advice on boards and directors
Common mistakes
- Failing to seek external advice — collaborate with trusted advisors to ensure your plans are realistic and attainable.
- Rapidly hiring new staff to handle an increased workload — first, assess the long-term scope and cost of any new roles, and only bring on individuals who are the right fit for the business.
- Neglecting to measure your progress — determine what to measure and how to measure it. This will assist you in identifying when things are functioning well and when adjustments may be necessary.
- Refusing to adapt your agenda when things don’t go according to plan.
- Underestimating the costs of growth — consider your finances, but also contemplate how to efficiently utilise your time and mental energy.
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