If you’re taking the key decisions for business, or offering advice to those who are, whether you’re a founder, CEO, on the board or a trusted and deeply involved investor, you need to understand how growth works. Growth is vital for a business’ success in the long term, but there are different ways for businesses to grow and they’re not all equally suitable for all companies.
In some cases, a growth project that fails could lead to the waste of some resources, and some insight into how you could do better next time. In others, it could overextend your business fatally, sucking up finances and resources from established, stable sectors of your business and leading to a total collapse.
Even in the case of a non-catastrophic failed expansion, public, visible failure can harm your brand. Closing a branch can lead to people feeling sorry or hard done by local employees who lose their jobs, and if you’re an expertise-based business like an accountancy or consulting firm, a public overreach like that damages your brand: it makes the advice you’d give to clients less trustworthy.
Planning for Success
The most important thing you can do is plan and research. There are no guarantees of success, but if you understand the challenges you’re facing, you can plan for them, and nudge the odds in favour of good outcomes.
If you’re aiming to expand your business abroad, you need to budget for the international research that can help you do so effectively, for example. To try to break into a foreign market without ensuring you fully understand the foibles of that market, it’s customers and trends and regulations, pushes bullish confidence across the border into arrogance, and trying to do without that specialist research from experts in the field is the worst kind of false economy.
The Benefits
If you do your research and avoid the pitfalls, there are more benefits to growth than you might think. The initial effect is of course, more income! More money flowing into your business is rarely a bad thing, but there’s another advantage here: stability. All success is fleeting. Trends move on, markets evolve, economic circumstances change and what was once popular and sought after can become ignored and shunned, which dries up your revenue stream.
If you carry more, different products, trade in more markets, to different groups, you’re not dependent on a single factor for your continued survival. You can endure changing circumstances because you have multiple streams of revenue from different sources, leading to true, long term success.
