If you’re reading this article then your company is perhaps already entering into the growth or expansion stage. In business, there’s five key stages of growth:
- Start up
According to the Small Business Administration (SBA), around 30% of new businesses don’t make it past two years, while 50% of businesses fail within the first five years. However by the 10 year mark, this figure only increases slightly by 16%, meaning younger businesses are more prone to failing and that businesses who can consistently replicate positive results are more likely to stick around.
Throughout this process of business growth the business also goes through various stages of expansion and contractions, otherwise known as the business cycle. For more on this, check out this short clip by CFI (Corporate Finance Institute).
With so many factors at play, it’s important that leaders give priority to coming up with a solid business plan that’ll help them achieve not just immediate but also long term success.
This article is comprised of two parts. In part one, we’ll be looking at the growth and expansion stages of business as well as the key directions leaders are to take for each stage. In part two, we’ll be looking at the risks of not having a proper business plan as well as tried and tested ways reputable businesses have achieved long term business growth and success.
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Understanding the Different Stages for Long Term Business Growth
As a business enters each stage of growth, it is crucial that they figure out the strengths and weaknesses of the company and re-adjust their business strategy to match their current needs and offers. Essentially, the growth stage is the first major step businesses take to move into a more efficient and sustainable business model that’ll secure their success for the long run.
The growth stage is also when businesses will see more competition rolling in. Challenges in the growth stage includes streamlining the business to gain a competitive edge by making the business more agile and efficient, producing the most at the lowest cost.
As with at any stage, having the right people to fight for your team will be important. Especially for businesses entering the growth stage, essentially they are shifting gears. For these reasons, it is paramount that both leaders and employees align their mindsets so that they’re be able to grow alongside the business.
With the growing demands of the business, a good business plan will be one that dedicates resources to the recruitment process, hiring smart people with complementary skill sets.
In the expansion stage, businesses should already have a strong business model and should be aiming to broaden its distribution channels.
This stage is all about continuing the business success. A common mistake businesses make during the expansion stage is to slack on the quality. While this may not be intentional, it’s important to keep in mind the impacts business expansion may have on the current quality or service/ product you provide.
With pressures to grow, many businesses at this stage runs the risk of taking on too much. While businesses should aim for business growth, leaders mustn’t forget to properly measure and evaluate each growth opportunity so they can better secure their company and not fall prey to otherwise easily avoidable mistakes.
Identify your needs
To minister the right treatment, a doctor needs to first diagnose his patients. Likewise, for a business to find the right growth strategy, they need to first identify the stage and the needs of the company.
A quick an easy way to properly evaluate your company’s current positioning is by conducting a SWOT analysis. This way, you can better take hold of each business opportunity and avoid taking projects that could drag your momentum down but overstretching your resources.
Long term business plan
A good business plan is one that can replicate business success, this means it should not only think about the now, but also the future accommodating for the different needs at different stages of business growth.
Hire the right talent for growth
People are essential to the well being of a company, especially at times when the pressure is on. Hiring people with the right skills set and mentality will help you build a healthier and more agile workforce, all of which are beneficial in building a solid business foundation for growth.
Need help looking for the best talent in the market? Get in touch with Links Recruitment and start building your team for the future.
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Stay tuned for part two of this article on “How to Achieve Long Term Business Growth”. Subscribe to the Links’ blog for more HR insights today!
With 20 years of recruitment experience in Asia, Links has been trusted by over 10,000 clients with finding the best people to build their businesses. Get in touch with own of our representatives and learn how we can help you expand your team.