Most businesses want to grow, but with less bank finance available these days it’s not easy to just buy out a competitor. If you can’t grow by “mergers and acquisitions”, you need to develop a strategy to grow your business organically which can prove a much slower process.
Organic growth is especially prevalent during the early stages of a company’s commercial establishment, but opportunities continuously present themselves if you listen to the market. So, if your firm is committed to meeting the needs of its customers and is commercially driven with a good control over costs, you can use the following strategies to drive business growth.
Also known as the “Protect and Build” strategy, this conservative approach sees a company consolidate and stabilise its position in the market by selling more existing products to existing customers. To make this cross-selling approach work, your firm will need to leverage existing resources and capabilities; this will allow your business to capture a larger share of existing markets. This strategy is low risk as you wont need to launch new products or services – instead, just focus on selling more to existing clients and contacts.
A product development strategy focuses on creating new products or services and introducing them to existing customers. If your business is good at creating new innovations then it is probably well positioned to use this strategy. The key is utilising market research in order to identify a need or gap in the market for a new product or service. If there is potential demand and you launch the right product or service, then you stand a reasonable chance of success. There is an element of risk inherent in this strategy, as developing new products requires investment from the business.
This approach involves the promotion of existing products into new markets. These could be industry sectors or geographical territories. This approach requires the firm to invest in market research to define which markets are best to target. There is an element of risk to this strategy, as it requires both time and money in order to conduct the research and to develop appropriate marketing campaigns.
This can be a risky growth strategy because to diversify means creating new products or services and selling them into new markets at the same time. There are a lot of “unknown unknowns” involved, such as the competitor landscape and the needs / requirements of customers in that market. There is also risk inherent in the fact that the company is somewhat reliant on the strength of its brand in a market that is not necessarily familiar with. However, diversifying can give the company an opportunity to really grow if the new product / service is well received and the new target market is big enough.