Simply put, organic growth is business growth achieved internally. It doesn't involve buying up similar companies to eliminate your competition, making sales growth more attainable. Here are three strategies to help you achieve your business growth goals.
Organic growth strategies
- Optimize your current processes
An excellent place to start when looking to grow your business from within is examining your current processes. Inefficient business processes can cost a company money in different ways:
- Efficiency is an essential element for organic growth. Where can you add resources? Can you add funding or employees to increase efficiency? By reviewing and auditing your operations, you can uncover deficiencies that can be detrimental to growth.
- Slow-running processes can cause delays in production or shipping. This delay is passed on to customers who have to wait longer for their product. Unsatisfied customers stop buying your products or using your services and can lead to negative online reviews.
- Add or expand your products and services
Adding new products or services is probably the most obvious way to grow your business. Here are some things to consider:
- When adding a new product or service line, make sure to do your due diligence and perform a thorough cost analysis.
- Spend time doing market research before adding a new product or service. Is there a demand for it? How large is the demographic the new product/service will target? How much competition is there for this type of product/service? These are questions that will need answering to forecast your sales growth in this area. You may read this article, https://delighted.com/blog/how-to-measure-and-track-product-market-fit to help you with your market research.
- Make sure you can price your new product/service competitively. Research similar products and services, find out what they offer, and see if you're able to set a price that will pique potential customers' interest.
- Reallocate resources to areas in need
Take a look at your resource allocations and identify where resources are being used and your ROI (return on investment). Some things to consider:
Build and add value to your business
- Are you continually putting resources into a failing product or service, hoping it will "spring to life"? If you have older products or services that aren't performing as you would expect, determine ways to improve the product/service. Compare the cost of improvements to sales projections to see if this makes sense. If your ROI isn't what you want, it may be time to move on from these older products/services and use resources elsewhere.
- Determine if some year-round products only sell well during certain times of the year. Consider altering your production schedule to match peak sales for these products, allowing you to reallocate resources from this product line during slow times to other products/services that perform well throughout the year.
The benefits of growing your business don't stop at (hopefully) higher profits. If done right, your business value will increase as you grow.
The Value Builder System™ is an excellent tool for business owners as it gives you a current assessment of your business and offers advice for how to increase your company's value. The eight key value drivers include:
Taking a holistic look at where your company value is currently will help you determine areas you can improve on.
Take your business personally
Think of your business as a living thing. Just like your body, you want to make sure you are taking care of it by watching what you eat (resource allocation) and exercising regularly to stay healthy (ROI). If you experience pain, you find ways to treat the problem. The same goes for running a business. If you have a problem area or something that prevents your business from growing, you need to identify it and find a solution. Growing your business and staying healthy both require patience and intelligent decision-making.
Take a look in your "business" mirror and see where you can use the strategies above to grow your company organically. Your business will thank you for it!
Ready to get started on your growth strategy? Start here.
- Financial Performance
- Growth Potential
- Working Capital
- The Hierarchy of Recurring Revenue
- The Monopoly of Control
- Customer Satisfaction
- Management Depth.
If you have any questions about how SVA can assist your business, please contact the author