When it comes to your company, you want to make sure that your product or service is going to help you learn and grow. The whole point of owning a company is to build a clientele, have a great product line, and focus on the market. To do that, you need to know how to grow, what to do, and the options available for anyone at any point in their small business.
What Is a Growth Strategy?
A business growth strategy is a plan that helps you achieve more shares and branch out into new markets than what you currently have. Growth is achieved through many means. For example, you can acquire more customers, add more locations, or expand and add new products.
What Are the Seven Major Business Growth Strategies?
When you’re focused on developing a business, you need to focus on growth. To do that, you should consider the four different growth strategies that anyone can use.
1. Market Penetration Strategy
With market penetration, you decide to market your existing products in the same one you’ve been using. To do that effectively, you need to boost market share. This is the percentage of dollar and unit sales the company holds within a particular market. You may be competing with another company here. A good way to do that is to lower your prices.
2. Market Development Strategy
Market expansion or development requires you to sell your current product in a new market. Companies do this for various reasons. If you don’t find a new market for the things you sell, you can’t boost profits and sales. Sometimes, this means finding new uses for the same item. For example, if you’re a soap distributor selling to retail locations, you can also market to factory workers. This strategy doesn’t take a lot of work and can help your business develop new ways to sell.
When you develop a business, you have to focus on product development first. This growth strategy ensures that you are always creating new products and marketing them effectively. Companies often do this at high risk.
Small companies have to plan carefully and perform plenty of market research. That way, you can determine if the customers in that new market are going to like the items you sell.
4. Acquisition of other Companies
Developing business strategies is hard. Your growth strategy has to focus on what is best for you. Sometimes, other companies could benefit, as well. Take a look at the existing market and see if some other company is floundering. Your competition could help you take a share of the market with current products or a new one. This secures the future of both businesses. Acquisitions can be risky, too, but they aren’t as difficult to pull off as the diversification strategy.
To develop business strategies effectively, you need the right growth strategy. There are three basic options here. Staying ahead of the competitors is tough work and requires a fight. However, you’ve got to win to be the best. Your growth strategy is going to assist you in many ways. However, it depends on the nature and size of the company. There isn’t a one-size-fits-all option. You’ve got to find a strategic management course and stick with it to be successful.
5. Alternative Channels
There may be other ways to sell your products. You might only be selling things in a physical store. A growth strategy means that you branch out and try fresh things. Consider creating an e-commerce website and sell items through there. Of course, this means learning that part of the industry, but it is a great way to think long-term.
Alternatively, you might only sell things online, so consider opening a pop-up shop outside somewhere to sell items. It might also be beneficial to create a membership or subscription program to help you find new customers. Create a mobile app to sell things or to get people interested in your products.
6. Product Development
With this growth strategy, you develop a new product to sell in an existing market. Usually, companies use this strategy in markets where technological development is fast, such as with cell phones or electronics. Small businesses can utilize such an expansion by adding something to the line or adding more features to existing products. Sometimes, the items you sell become obsolete. Consider changing it and modernizing it so that customers want to buy it. This might take research on your part, but it’s a great way to refocus your ideas and play on what you’ve already got.
7. Market Segmentation
The last growth strategy can help businesses that are struggling to find a place in their niche. You can have the best item in the world, but if you can’t sell it, you’re at a loss. Every entrepreneur is part of a particular market. If you haven’t been successful, it might mean you need to divide the market into related but different segments. You’re still focused on the same thing, but you look at the big picture. This takes some time to start, but your services and products would be better suited. Plus, you are going to appeal to a new niche and stake the claim for that area. This idea is based on two key things: you identify that there is a need, and you increase your revenue by taking the first step.
This involves risk on your part, but your clients are going to be impressed with the updated market offerings. Consider advertising in a newer way, branching away from the traditional market offerings, and see where that takes you.
Choosing the right growth strategy can be difficult. However, if you arm yourself with information about the markets, your competition, and what people want, you should be able to pick the right one to meet your needs.
Now is the time to work on your growth strategy. It’s easy to think you can put it off until you’re making more money, but you don’t want to find yourself in a rut right when you’re doing your best. If you always focus on the future, you’re sure to find the growth you desire.