Entrepreneurs rarely want their businesses to stand still. There’s always a push to reach the next milestone, improve results and take the company to a new level of growth that brings enhanced performance.
However, the desire to grow is just one of many factors fuelling expansion. Understanding these influences is essential as it enables you to determine the best time to move your business forward with strong chances of success. It also helps you determine why your growth moves might not be going as well as expected.
Below, we have listed seven factors contributing to business growth and development, determining when, why and how you move forward.
Customer loyalty
Many businesses focus on increasing sales. However, this only works if you can retain your core customer base and prevent those who already purchase from going elsewhere. Customer loyalty and retention is paramount .
Customer loyalty has many benefits. Firstly, it enables you to obtain repeat and additional purchases from customers at potentially higher values. This increases the money you earn per customer.
Secondly, loyal customers often share their positive experiences with friends or family. It leads to word-of-mouth marketing, which has the power to influence 92% of consumers and substantially drive sales from new leads.
If you are looking to grow, an expanding customer base matters – and customer retention ensures this is growing rather than just changing shape. The result is more demand and sales that allow your business to scale.
Leadership
Another crucial area is having influential leaders who chart the course, create excellent environments, and guide staff. You need to have a clear vision for your business and a management team that can bring it to fruition.
Strong leadership brings many factors associated with growth: resilience to survive hardships, motivation to push for the best results and a direction that the entire workforce knows to follow.
Business development should occur smoothly and with the intended results with the right people at the helm.
The market
Consumer behaviour is constantly changing, and, as a result, markets do too. Your ability to grow will, to an extent, be dictated by the scope available in the market your business sits in.
If demand is low, you are unlikely to be able to generate high levels of sales. You might even witness a decline.
When demand shifts, the key is being agile. Identify trends in the market that can improve demand and incorporate them into your processes or move across to new markets where you can generate sales.
This will enable you to maintain growth, despite the changing context.
Innovation
Innovation and technology can support development, especially if it leads to better processes that drive efficiency or allows you to offer something your competitors don’t.
Innovation covers many parts of your business, including product development, processes and operations, service, etc. Using it effectively drives quality, enabling you to offer a better experience to customers that drives sales. It is also crucial in cost reduction and increasing profit margins, further pushing growth.
The key is understanding the latest technology in the industry and finding solutions that support your objectives and give you a competitive edge.
Skills
Every business needs staff – and your employees play a crucial role in leading you to success. You need adequate skills to meet your targets, effectively serve customers and move forward.
Part of this revolves around your recruitment strategy and ability to find candidates who match your values and form a vital part of your future. You may need to find skills to introduce new roles and functions required to scale your business.
It might also include nurturing your existing workforce so they flourish alongside your company. Providing training and personal development will help achieve this, placing you in a strong position and improving staff retention.
CSR
Corporate social responsibility is a significant part of today’s world, with customers prioritising the ethical and environmental ramifications of their purchasing decisions. As a result, businesses need to meet these pressures.
If a company wants to grow, it’s therefore imperative they address social and climate issues. The demands from customers will only continue to increase until those who do not embody CSR get left behind.
Ensure you are being as sustainable as possible as a business and communicate this with your customers to win over sales and avoid any issues that might arise from a poor reputation.
Scalability
Growth needs you to have a business model that enables you to scale up effectively and meet demand.
This includes having processes that increase output, sales strategies that maximise revenue and careful cost management.
By scaling up practically, you will reach your growth goals while maintaining healthy profit margins and avoid any issues that could disrupt your success later down the line.
Conclusion
Growth is rarely linear and will occur differently for every business, primarily due to the many factors at play.
It is vital to comprehend the contributing influences and understand whether your business will overcome the risks. By doing so, you ensure you grow at the right time, with the tools you need to succeed and secure long-term results.
If you are ready to take the plunge and scale your business, get in touch with us to find out how to progress your journey with the proper funding.