Business growth is a lot like a human being — you need to keep growing for survival. In fact, ask 60% of businesses that were listed on the stock exchange since 1980 that are no longer in existence. You'll quickly learn the importance of growing your business beyond survival.
“Business growth” is a commonly used term to define a variety of conditions. From an increase in sales to the increase in the number of employees, business growth is a phrase that easily describes a multitude of situations. Simply, business growth is demonstrated by an increase in size or scale with an accompanying increase in yield.
Every small business owner launches their shiny, new enterprise with great hope and optimism for progress in size and scale. Unfortunately, increased competition, the downturn in the economy, or uncertainty in the marketplace has brought some entrepreneurs to their knees. What started as a dream for a castle in the sky has tarnished to a pup tent in the backyard (aka survival).
Here are 4 convincing reasons to grow your business beyond survival:
1. Economies of Scale
Along with business growth comes your ability to leverage costs. This allows your business to run more efficiently and effectively, including lowering costs associated with producing your product or service.
Although this may seem more applicable to manufacturing, the service industry can leverage economies of scale as well. For example, let's say you're an accountant billing at the rate of $200/hour. When you “do it all”, including bookkeeping, admin, project management, filing, andtax preparation, the cost to produce your service is quite high. It certainly cuts into your overall profit margin.
However, growing your business beyond survival allows you to outsource administrative duties, bookkeeping, marketing, and project management at a lower rate. This not only frees you up to generate more revenue, it also improves the overall profitability of your service.
2. Higher Profits
Tied in with economies of scales, business growth allows your business to experience greater profits that you can choose to pay out to yourself, as the owner, or reinvest into expanding products and service to continue the upward trajectory of business growth.
3. Market Expansion
Business growth beyond survival means you'll have the resources you need to make the leap to the next level in your business. Whether you choose to expand current products into new markets or introduce new products into your current market, you have the opportunity to take advantage of additional business growth opportunities that exist.
4. Brand Awareness
The more your business grows, the greater your exposure. The more others become aware of your brand, the more opportunities exist for expanding your business growth through client acquisition, strategic partnerships, and other such probabilities.
Are you convinced of the need for business growth beyond survival? Although it feels a bit like the chicken and the egg theory, one thing we know for sure — business growth begets business growth.
It's the only way to grow!