About 20% of businesses close within the first two years. There are a few common threads between these business failures.
The ones that stay open don’t fare much better. Most are stuck in survival mode with little cash on hand to navigate unexpected challenges.
It’s the dream of small business owners to gain enough business momentum to grow. Yet, they don’t fully understand the stages of business development, so they stay stuck in survival mode.
You started your business so you can do more than survive. Keep reading to discover what the stages of business growth are so your business can thrive.
This is where you have an idea or inspiration to start a new business. In the development stage, you spend time validating your idea and planning the business.
Too many business owners skip this stage of business development. They go from having an idea to the second stage without much thought.
Validating the idea lets you know that there’s an audience that needs your product or service.
You’ll develop and refine the idea further so you set yourself apart from the competition. In this stage, you’ll write a business plan and financial plan for the business.
The startup phase is where you open your doors for business. You figure out systems to best serve your clients. You may need to raise capital to fund the business.
This is the first few months of the business. It’s a critical stage because it sets the course of the business.
Business owners need to be able to adapt quickly to market conditions. They also have to be willing to accept mistakes and learn as they go along.
Sole proprietors make up 73% of businesses in the US. They reach a point in their business where they have a market presence and a reliable stream of income.
They look to take that next step to grow. They want to hire employees to be able to work with more customers. This isn’t easy to do because the revenue needs to support the cost of employees.
It requires an initial investment and hiring the right employees. That reduces turnover, which increases your operations costs.
Work with a headhunter who can help you hire the right candidate each time.
Expand and Scale
Business expansion lets businesses explore ways to increase market share and expand into different markets.
They might sell the same products and services in a new location. Businesses expand product lines to serve more people.
Mergers and acquisitions are another expansion strategy. You need to make sure that you control resources so you don’t expand too quickly.
Very few businesses reach this point. If you do, know that it’s not the end-game of the business. You still need to apply what you learned in the previous stages of business growth.
You’ll need to be able to adapt to market conditions, hire the best employees, and spend your resources wisely.
The Stages of Business Development
How can you grow a business? By learning the stages of business development, you now have clear goals and objectives to grow your business.
If you enjoyed learning about business growth, you’ll enjoy the other business articles on the blog. Check them out today.