Growing your business is one of the big responsibilities of the founder and leader. Even if you don’t want to become an international titan, a degree of growth is necessary simply to stand still. The market moves on, new products are developed, your customers adopt new styles and ideas and you need to grow your offering to be ready to meet them.
Unfortunately, for all that it’s a necessity, growth can also be a big risk to your business. Today we’re taking a look at those risks and what you can do about them to paint a picture of what safe, sustainable business growth can look like.
Brand Damage
It’s important for you to plan any growth project, be it opening new premises or extending your product line, with your brand in mind. Your brand is the identity customers assign to your business based on all their interactions with it – not merely ‘branding’ like fonts, slogans and colour schemes, but their experience in store, conversations with workers and where and how they see your adverts.
Your brand helps to tell potential customers they’re going to be welcome and happy at your business, so it’s important you grow your business in a way that’s consistent with that brand. If you’ve cultivated a reputation as a high end business within your field (like Waitrose within the grocery trade, or Farrow and Ball in the decorating field), then any new premises you open need to live up to that promise – a new Waitrose store in a decrepit building on the wrong side of the tracks attracts neither core Waitrose customers nor a new audience looking for a bargain – it confuses both!
Before you plan a growth spurt, you need to make sure you understand your brand. A programme of market research ensures you know what your customers think of you, and what they value about what you have to offer.
Financial Risks
One of the biggest risks of growth of any kind is financial – it requires significant outlay, and takes time to recoup that cost and become a stable, producing part of your business. If it takes longer than you’ve calculated for to become profitable – or worse if you’ve simply not done the calculations, you might find the costs of your expansion overbalancing your established, successful operation. While finance options are available, they all involve taking on debt from banks or compromising your decision making position within the business with investors.
It’s important to have a strategy governing your expansion so you don’t make those short term, shortsighted decisions. Working with a business strategy consultancy ahead of time can help you set a framework for growth that keeps you safe and sustainable and set for a long and successful future.
