When starting a small business, there are so many processes to think about - for instance high cash flow - that planning for growth may be at the bottom of your agenda. However, it is important to plan ahead early or risk not being prepared if, or when, growth happens.
Below are three aspects of a growth strategy all good businesses need to consider.
It is important to plan for growth early or risk not being prepared if, or when, it happens.
Consideration 1 - Core values
An overriding business plan can help you identify your ideal business outcome, as well as develop the steps required to make your business vision a reality.
This can involve the types of assets you will need to acquire, the markets that your product can penetrate and the development of new and innovative products. It should also focus on the risks involved with growth, such as unpaid invoices or over-diversification.
But, to grow your business, you will need to align your strategic decision making with the core values you have outlined in your strategic plan. This should help you identify and pursue the opportunities when they arise, instead of being locked in to redundant business agreements.
Consideration 2 - New markets
One of the hardest decisions a business owner will need to make is whether to pursue new opportunities within new markets, or stick to traditional sectors.
A report by PricewaterhouseCoopers argues that although new markets can offer a range of new opportunities, they are also filled with pitfalls and challenges. Furthermore, when a company enters a new market, it is typically less experienced than its competitors, which compounds the risks it faces.
In response, the report believes that strategic flexibility is a key characteristic for growth. Being able to respond to legislative, environmental and social changes, without sacrificing customer satisfaction or cash flow, is about implementing a strategic vision that can respond to change and even profit from it.
Consideration 3 - Debtor finance
When starting a small company, it is next to impossible to turn away clients - and for good reason. All companies rely on a strong customer base, however, small or new businesses need to grow their customer pool to compete in the market.
If a business does turn away or delay new contracts, it can risk impacting customer retention and affecting its revenue and cash flow.
To avoid a situation like this, a business could enlist a financial solutions provider. One such service currently on offer is trade credit insurance. A policy with an experienced provider such as Earlypay can offer businesses the comfort of knowing that a customer's failure to pay will not lead to insolvency.
Using a financial solutions provider within a business growth strategy is a great way to manage risk, and avoid the pitfalls that can challenge business growth.
If you'd like to learn how Earlypay's Invoice Finance & Equipment Finance can help you boost your working capital to fund growth or keep on top of day-to-day operations of your business, contact Earlypay's helpful team today on 1300 760 205, visit our sign-up form or contact [email protected].