Having a ground-breaking business idea is a great way to start your entrepreneurial journey, but it’s only the first step. To thrive in today’s market, you also need to know how to grow a startup business into an established company. Let’s take a look at what’s involved in growing a business from startup to a well established and successful business.
How do you start a business?
If you’ve already registered your business and started trading, you’re on the right path. If your business is just an idea right now, start by writing a one-page business plan that defines what you hope to achieve. Decide how much you can afford to invest in the business and draw up a budget for your costs. Next, file the paperwork to turn your business into a legal entity. Whether you decide to incorporate as a sole proprietor or a limited company, you’re now ready to start selling.
How long does it take to grow your business?
It’s difficult to say how long it takes to grow a business, as many businesses never stop growing. However, it’s usually a good idea to aim for profitability within 30 to 90 days to avoid exhausting your funds. From this secure baseline, you can continue growing your customer base and sales figures until you feel ready to expand into a new market or product line.
How does a startup grow?
There are many strategies for growing a startup business cost-effectively, some of which have been tried and tested by generations of entrepreneurs. If you don’t know how to make your business grow, try using these 10 cost-effective tips to grow your startup without breaking the bank.
1. Focus on fundamentals first
Before you start using the other tips for growing your business, you must be sure that your core product or service offerings are working well for you. For example, if there’s a flaw in your flagship product, it pays to fix that before you start diversifying your product range.
2. Every entrepreneur needs a strong team
Growing a business is hard work. When your business was very small, you might have been able to do everything yourself, but as you expand, you’ll likely need a team of trusted people around you. Before you try to expand, find the people you need. Recruit employees who share your passion, find freelancers you can rely on and partner with other businesses that can provide the services you need to manage your company.
3. Reach out to new customers
If your sales growth is slowing, it could be that you’ve already saturated the primary market you decided to target. To grow your business, you may need to reach out to other groups of people. For example, if you’ve been advertising your product exclusively to students, consider whether young adults could also be a suitable market.
4. Expand your social media presence
Investing in social media advertising can be a good way to spread awareness of your brand to new markets. Social networks allow you to target your followers’ friends with marketing messages, which could gradually expand the sphere of people who are aware of your products or services. Consider increasing your social media advertising budget and investing more time in creating content to share on social networks to see whether these steps can bring in new customers.
5. Partner with an established company
Partnering with an established company can be one of the best ways to grow a business. For example, if you sell fitness clothing, consider partnering with a business that offers fitness classes. You could offer discounts to customers who buy your clothing after attending one of your partner’s classes, while your partner may want to give free trial classes to anyone who purchases clothing from your brand. These kinds of partnerships allow two related businesses to share their markets, which can be a very cost-effective way to bring in new customers and sales.
6. Reward customers who drive growth
If you have a few loyal customers who love your brand, consider rewarding them for spreading the word to their friends and family members. You could offer gifts for people who refer new customers to your small business or recognize their devotion by featuring them on your blog or Facebook page.
7. Diversify your product range
This tip for how to grow a small business comes with a warning. Adding a new product to your range isn’t a guarantee for growth. However, if you take the time to find out what products your customers want, expanding your range could increase your sales figures. Before you commit to a new product, send out surveys to past customers to discover their level of interest. To avoid losing focus, your new products should be closely linked to your core product.
8. License your product
Licensing your product means allowing other companies to make money from selling it. Every time one of your licensing partners makes a sale, you receive royalties. Licensing can be a low-cost method of increasing your product’s reach, but you must choose your license partners and terms carefully to ensure this growth strategy will be profitable for your startup.
9. Open a new physical location
If your startup is a brick-and-mortar business, opening a second location is an obvious way to expand your enterprise. You’ll need to choose your new location carefully to ensure it will get enough customers without taking footfall away from your original site. If your business operates purely online, moving it into the real world (either by opening a permanent physical outlet or running stalls at events and trade shows) can be a good way to expand your reach.
10. Fulfill your promises
Always ensure you can fulfill new orders before going on a major marketing drive. If you bring in a lot of new customers but fail to deliver the service they expect, they’re unlikely to stick around. Preparation is the key to sustainable growth.
Now that you have some ideas on how to grow a startup business, it’s time to begin brainstorming ways to reach new markets. Take the time to listen to your existing customers. They are the best resource for understanding what you need to do to grow your business and fulfill your growing audience needs.