Growing Your Small Business Into A Profit-Making Machine

Business growth is driven by the desire to expand a business to generate additional profits.

The achievement of this goal requires the development of a growth plan that identifies and implements strategies to create new products, expand customer base and generate more revenue.

The foundation for this is a detailed framework that includes objectives, strategies and activities for achieving the growth goals of the business over a definite time frame, like a year, five years or longer. 

The strategies for creating your business growth plan will be determined by your goals and the methods you want to apply to achieve them. Your options may include market development, product development, market penetration and diversification.

A market development strategy seeks to increase growth by assessing and targeting your marketing efforts to new demographics. In pursuit of this strategy, you identify and reach new markets. For example, you can direct your marketing and sales efforts toward reaching a wider audience in a new geographic location.

A product development strategy involves creating new products or providing new services for customers in your current target market. Instead of looking for new customers, you offer new products or services to customers who are already doing business with you.

If you own a Fitness Centre, for example, you may decide to add the sale of shoes, clothes and related items to existing customers. 

In striving to increase your share of your market, your business can deploy a market penetration strategy that encourages your customers to buy more of your products or services. You can do this by attracting new customers and/or more purchases by offering discounts to them. For example, your software business can reduce the cost of its product to attract more customers.

The diversification option combines market and product development strategies by focusing on multiple endeavours. In diversifying, you can consider new products and services that you can offer to new markets.

For example, your inter-city transport business can add parcel deliveries to its range of services.

10 Steps For Growing Your Small Business Into A Profit-Making Machine

How do you translate your chosen option(s) to a framework you can leverage in growing your small business?

Here is a 10-point step-by-step action plan to grow your business to the level of profitability that you envision: 

Step 1: Clarify Your Goals

Begin your growth plan by being clear about the type of growth strategy you plan to pursue, and having a vision of what you hope to achieve by the end of the plan.

 What do you want to achieve in, say, five years? By how much do you want to increase revenue, profit, market share or something else? Set clear goals.
Once you know your specific and definite goals and have them in mind, you can then develop a plan to achieve them.

Use the SMART method to create goals that are Specific, Measurable, Achievable, Relevant and Time-bound.

To be specific, rather than setting a goal to increase sales, you may create a goal to increase sales by 5%. To be measurable, you may have a goal to gain at least 10% more customers each month. To be achievable, based on your current performance, make sure your goal is not so difficult as to lower motivation or too easy as to create boredom. To be relevant, ensure that your growth goal aligns with the long-term goals of your business. To be time-bound, set deadlines to help your team in tracking short-term benchmarks as they progress toward long-term goals within your established time frame.

Step 2: Conduct A SWOT Analysis

What are the strengths and weaknesses of your business? What are the opportunities available to you and the threats facing your business? A SWOT analysis will help you identify your strengths, weaknesses, opportunities and threats.

It will enable you to develop a plan to leverage your strengths, improve your weaknesses, capitalise on opportunities and mitigate threats. Analyse your current business. 

Step 3: Develop A Marketing And Sales Strategy

Who are your ideal customers? What are their needs and wants? Where do they spend their time and money?

How will you reach your target market and promote your products or services? convince them to buy from you? generate leads and convert them into customers? 

Activate a target market strategy that outlines how you plan to reach your target customers and generate leads and sales. This should include a plan for building your brand and increasing awareness of your business.

Once you know your target market, you can develop strategies to reach them and convert them into customers. Create a marketing plan that includes a mix of online and offline strategies, such as content marketing, social media marketing, email marketing and paid advertising.

Step 4: Refine Your Sales Process

How do you convert leads into customers? Your sales process should be efficient and effective, and tailored to your specific target market.

Have a sales plan that includes a process for prospecting, qualifying leads, nurturing relationships and closing deals. Increase customer retention. It’s much cheaper to keep existing customers than to acquire new ones.

Focus on providing excellent customer service and building relationships with your customers.

Step 5: Invest In Your Team

Your team is your most important asset. Surround yourself with talented and motivated people who share your vision. Make sure you have the right people with the skills and experience to help you achieve your goals.

Build a strong team. Engage with your team, which should include your internal and external stakeholders. Seek their input to improve the action steps of your plan. Getting help and feedback from others is critical to achieving your plan.

Invest in training and developing the team members who will help you grow your business.

Invest in developing the team members

Step 6: Expand Your Product Or Service Offerings

One way to increase revenue is to offer more products or services to your customers. Your new offerings should meet the needs of your target customers.

Step 7: Enter New Markets

Your business can also increase revenue by entering new markets.

Once your business has saturated its current market, it should consider expanding into new markets. This could involve selling to new customer segments, entering new geographic markets or launching new products or services.

Step 8: Improve Your Operations

Look for ways to improve the efficiency of your business. Get it to concentrate on its core competencies.

Determine what the business is best at and let it focus on doing those things. Identify the most profitable products and services of the business, and devote its marketing and sales efforts to them.

You could also look for ways to reduce costs without sacrificing quality. This could involve investing in new technology, streamlining your processes or outsourcing certain tasks. Negotiate with suppliers. Find more efficient ways to operate. Eliminate unnecessary expenses.

Step 9: Track Your Results

It is important to track your results so you can see what’s working and what’s not.

Determine how you plan to measure success and the relevant metrics to evaluate. Use Key Performance Indicators (KPIs) to track your progress.

 Identify the person(s) responsible for completing the actions to ensure that each person understands his or her requirements and expectations, and is working towards the common goals. Once team members have reviewed and approved the plan, and are working to implement the action steps, there has to be regular reviews to ensure that everyone is progressing as expected.

Consider weekly, monthly or quarterly check-ins to adjust the plan as needed. A focus on achieving the short-term benchmarks will keep everyone motivated to continue working towards the larger long-term goal. As you learn more about your business and your market, you may need to adjust your plan.

Step 10: Adjust Your Plan As Needed

Your business development plan should be a living document. Use your short-term benchmarks to monitor the action plan for yourself and your team members. This will help you stay on track and reach your goals. 

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