Business growth opportunities can be a balancing act for small business owners looking to scale up. It may be helpful to test the waters in terms of market demand and your company's ability to meet new demands.
To find the right balance of opportunity and risk, it can be helpful to seek advice from those who have been there before. Your business colleagues, customers, and financial backers can provide valuable insights that can help you find solutions and move forward.
The support your network provides will ultimately help you take advantage of business growth opportunities. Consider her four tips below from an entrepreneur with a track record of doing just that.
1. Focus on the customer
In business, your greatest asset may not be your products or services, but your people. Your customers will gain valuable insight into your business that they can't get anywhere else.
Jenny Poon, founder of coworking space CO-HOOTS, says some of her biggest business growth opportunities have come from her customers.
“I talk to customers and potential customers to identify the problems they face and think about the easiest way to leverage the strengths and networks I have to create solutions. ” she says.
For Poon, customer problems are just hidden opportunities. You may not notice it right away, but your customers might. Poon focuses on people and strives to improve their experience, which in turn improves her business.
“Identify what your customers value and what they are willing to pay for,” she says. “Then test those ideas. Compare them to the market and ask yourself if they can compete.”
Another test that can help you grow your business involves starting with a “minimum viable product.” This is a product with enough features to attract an initial customer base, who can then provide feedback for further product development.
“I talk to customers and potential customers to identify the problems they face and think about the easiest way to leverage the strengths and networks I have to create solutions. ” —Jenny Poon, Founder of CO-HOOTS
2. Monitor the market closely
Understanding your market is key when preparing to scale. Market research helps you identify the best products for your customers, improve them with new features and options, and pinpoint other future business growth opportunities.
Brent Thomson, CEO and co-founder of Blip Billboards, started his digital billboard advertising company this way.
“As markets become more efficient, I look for opportunities that can benefit the company,” he says.
In an era of continued innovation, acceleration and automation in digital advertising, efficiency has become increasingly important to customers in the markets Blip serves. Thomson's focus on these market trends helps him stay ahead of the curve.
“The best opportunity is to introduce new efficiencies across the market,” he says. “If my success depends on maintaining the market's current level of efficiency, my business will be going against the tide and will be less likely to succeed.”
3. Be smart about your financing.
Just as important as finding business growth opportunities is positioning yourself for business growth opportunities. For many small business owners, financing can be the biggest obstacle to growth.
Being financially prepared means you can afford the upfront investment and have the cash flow you need to expand. As Poon says, good old-fashioned savings can go a long way.
“I'm saving like crazy and setting up an innovation fund so I can invest in the problems I want to solve and make a profit,” she says.
Poon also suggests exploring creative partnerships if you can't generate income on your own.
“Partners may provide the necessary seed money or help build the product or maintain a financially viable business,” she explains. “If that is not possible, we will consider investors or bank loans.”
Good relationships with financial institutions help maintain stability during the growth period. Business loans and small business credit cards make it easier to manage your investments and cash flow.
Thomson argues that building a “good enough” business in the short term while maintaining a strong vision to plan for the future can be the key to financial security. He takes this approach in part because different types of financial backers view business growth opportunities very differently.
“Debt financing providers like sound business fundamentals, but are less concerned with vision,” he explains. “High-risk equity investors, such as angels and venture capitalists, invest in vision, product, and market size. Combining a strong vision with fundamental business performance can keep both funding sources as options.”
4. Start small and scale big
Challenges are common when trying to grow a business, but you can also start small to ensure you have enough working capital and the right processes to scale. .
This is what Poon is doing. When creating a growth strategy, she starts with manageable ideas.
“Identify the low-hanging fruit first and get into a rhythm of testing those ideas,” she advises. “Lock down the main model and do well. Then we will seize even bigger opportunities and expand.”
Important questions to ask when growing your business include whether you have enough people, systems, and borrowing power to meet the needs of a larger and more diverse company. Expanding too quickly can ruin your business. Signs that a company is growing too fast may include a lack of cash flow, poor customer service, and low morale.
Thomson also advises starting small.
“Before you make your first dollar, find business growth opportunities that don't require massive scale. This allows you to start generating revenue early in your business cycle. This allows you to improve your business concept. is verified, and also generates cash flows such as: Reinvestment is also possible. ”
Take-out
Finding a way to run a successful business is one of the biggest challenges for entrepreneurs, but it doesn't have to be tackled alone. You can tap into your network of business associates, listen to your customers, and foster relationships with your financial backers. That way, you can start small, test with customer demand, and see if your organization can handle growth.
Image: Getty
A version of this article was originally published on June 21, 2019.
