When you are trying to grow your business, the first step is to understand where you are currently standing. However, not all businesses will grow in the same ways. There are similarities and trends between them depending on the stage of the business.
Small business varies in size and capacity for growth. Where business growth is the progression of a business in phases over time.
Here are the stages that the business goes through in its development:
1. Startup Stage
This is the first stage of business growth. Many entrepreneurs consider this stage the riskiest. In fact, only a few employees survive in the first year in this stage.
There are many reasons why businesses fail in this stage. That is because you are spending much of your time and effort to bring your online startup business ideas to life. To take your business to the next level, your business must be efficient in operations to allow growth. This means:
- Delegating the task
- Hiring employees
- Starting a creative culture
As you move to another stage, prepare and take risks. Learn from your success and failures and be wise to pursue new growth opportunities.
2. Growth Stage
When the business reaches this stage, it demonstrates that it’s a workable business. It shows it now has enough customers that it satisfies sufficiently with the product or services to keep them.
In this stage, development is minimal. Formal planning is there for the best for forecasting. The major goal of any business will be survival. The enterprise may grow in size and profitability to reach the next stage.
Staying focused on your business goal in this stage may be challenging. It’s a good idea to:
- Maintain capital because you may fail to meet the financial obligation without it.
- Set goals that will let you grow with purpose by using resources in the most useful way.
- Create a realistic forecast to help you grow your goal and stay on track
This stage means it is time to manage business relationships with your vendors and suppliers. Without a hard-working team, it won’t be easy to increase business growth.
3. Success Stage
Once the business starts making a profit, the owner decides whether to invest. Here is the main stage where the business fails. Many owners think of funding other personal things with the profits. This leads to reverting the business to stage two.
The business that falls in this stage does so because the profits developed crumbles. For owners who choose to use profits to fund others things, their external markets shift. But for, those who choose growth need to focus on finding resources that can help do so.
The company can stay in this stage provided environmental changes don’t destroy the business place. The owner consolidates the company and marshals resources for development.
The acting manager must take over their duties performed by business owners. The manager needs to be competent as their upward is potentially limited to corporate goals. The managers help the business to meet the needs of growing businesses. If it succeeds, the business proceeds to the next stage.
4. Maturity Stage
When the business reaches this stage, you likely feel safe and secure. There are different feelings than other previous stages in the business life cycle.
This Stage is accomplished when an enterprise has settled into a position within the industry. At this point, your successful business has developed a customer base or brand.
That’s why some executives shift the primary responsibilities of business management to other owners. With strong cash flow, the business can defend its market position. Also, it can expand into other new territories using its brand recognition.
Revenue in this stage is steady and predictable. You should enjoy this period while looking for signs to make a change. While at this stage, you can decide to cash or reinvest in the business for further growth and sustainability.
5. Renewal/ Decline
This is the final stage of business in growth. In this phase, the profitability, sales, and profit decrease. The business fails to expand its business life cycle. It starts by adjusting to the business environment change. The business has no competitive advantage. It finally withdraws from the market.
Though this is the final stage of business growth, it is not the journey’s end or time to relax. Put the upcoming methods aside and think about the future.
Start to innovate the new ways of running your business. It would be best if you decided to cash out or reinvest. If you decide to invest in the business, consider sales and marketing to figure out how to pivot to meet changes in the market.
Take honest stock of the phase your business is currently in. Ask yourself the toughest questions. Are you doing it the right way? This will ensure your business has lasting power.
Everyone dream of succeeding in their business. You can implement each of the strategies discussed based on your financial capacity. Depending on your industry, try and check which strategies work.
Remember, every strategy comes with its challenges. They need to be understood by the operating manager. Try to identify the stage of your business and take positive measures.
Whether you have started a business or are about to start, consider the above five stages to help you develop your business into a successful brand.