Is business growth an option or a necessity?
guys, when we started off a business, we will working on growing it until it becomes mature. What than after mature? we will be talking about maintaining the mature business ... but than, what is maintaining, can we really able to maintain? Most of the time I observe the business will decline after mature, many times keep on growing seems to be the only option. How about your view?
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Expansion of business is necessary becoz it enable you to re-evaluate your present trend and upgrade your existing system.
Hi JC, from my vantage point as a Sales Consultant in the IT Professional Services industry, business growth will remain an ongoing focus goal. At the point of business maturity, when we have even more partnerships in place and our clients are continually calling on us to engage in projects, we will still need to focus on growth. Why? Because you can never count on business maturity as a guarantee that you won't lose your footing amidst the competition. As well, it fosters a sense of never getting too comfortable with a winning position in your respective industry. Hope this helps a bit, and I wish you much success in your endeavors. Sean
While not the only option, growing is the only practical option. Maintaining in a world of constant change is a losing proposition. Customers, product requirements, distribution channels, substitutes, etc. are all evolving around you. Maintaining in most instances is not an option. Anticipating change with a goal of growing your business is the only real option and may result in "only" maintaining.
Business growth is a necessity.
If your product is at a mature level you have three options: Innovate the product or penetrate new markets or sell your business.
The market penetration can be done through the franchising method for example.
The product innovation can be done throught the change on one or more characteristics of the product giving it one or more utilities, market it on a diferente way, make events and promotions in order to improve the consumer product's knowleadge.
Business growth is conditions of technical, social and family systems
Businesses generally follow a "bell curve" with fast growth initially, plateauing, then a downward retraction.
Nearly all businesses, once they are mature, either need to re-invent themselves or accept that they will decline.
The good news is that a rapidly growing business generally burns cash to grow, a business in maintenance mode, generally produces free cash, and a business in decline generally produces the most cash (cash is not burned as readily on growing or maintaining the business)
The options at the plateau stage are to reinvent the business, sell or accept that the business is going to decline and milk as much cash out of the business as possible.
It takes courage, tenacity and cash to reinvent an existing business, sometimes you are better to sell it at the peak and buy a business that you can build up...depends on your skillset
You can make a business out of selling the same old thing year after year if you are unquestionably the best at what you do. Craftsmen and mom-and-pop businesses can do that, although you still have to sell to replace departing customers. Any larger than that and someone will enter your space to compete with your nice fat happy business. You'll also find that your best staff people want an upward path for themselves too, so you'll have to accommodate that need either by growing or by increasing margins (which usually requires growing the product line).
Maturity can lead to death if you do not maintain a strategy and expand or diversify. Simply maintaining the status quo without any recognition of the changes in the customers or the marketplace, new technology, political and economic threats etc will lead you down the path of obscurity. Thats why you should conduct an annual (at least) PESTLE assessment and re-strategise - what we call a TRP (Total Risk Profiling) and identify all the SWOT elements and formulate a new strategy each time. If you don't have a strategy, you have no destination.
Even when in most of the business schools they teach that the growth is a need, I strongly bealive that is an option, even more nowadays with small or negative growths.