How To Redesign Your Business For Growth
Apart from some lucky* exceptions, a business that grows fast is one that has figured out the answers to three big questions:
- How you can easily get more customers and sales
- How you can make your sales highly profitable
- How you can increase capacity without damaging your profits or customer satisfaction.
In this article, you'll discover what's involved and start to think a little differently about what you may need to do to make your business grow.
So, let's get stuck in with the obvious part - being able to get more customers easily…
1. Generate Strong Demand (Niche)
It’s often said that a successful business is one that finds a hungry crowd and sells it what it wants. But most businesses don't concentrate on 'a hungry crowd'. Instead they try to sell to anybody and everybody.
They're operating under the mistaken belief that they will make more sales by selling to the biggest possible audience.
But it doesn't work this way.
If you don't target a specific audience for your products and services, then you'll find it far harder to catch anybody's attention with your advertising.
For example, when I started working with Airworld Tours they had no specific focus for the holidays they sell - they sold luxury holidays to every destination worldwide (they still do, by the way, but the bulk of their sales now come from what we did together).
When we reviewed their business to make it grow, we redesigned it to have a special focus on holidays to top hotels in Mauritius. We then built a marketing machine that generated hundreds of leads every month just from people interested in Mauritius.
Because of the volume of enquiries about Mauritius, their team quickly became expert in the destination. And again thanks to the volume they were able to negotiate the best deals with the relevant hotels and airlines.
It was a massively successful strategy. And they've since gone on to add further specialist destinations to fuel continued growth.
Specialisation is one of the key business strategies we can use to ensure you find an eager audience for your products and service. They all you have to do is deliver them what they want.
2. Make Robust Profit Margins
The key purpose of being in business is to make money, and the stronger your profit margins the more money you make.
For example, at the time of writing this, research firm IDC estimates that Apple has just 18.9% of the global smartphone market, yet is making 92% of all the profit in the industry.
That means that all of Apple's competitors are surviving on the scraps, more or less, of the market.
The more profit you make, the easier it becomes to out-perform your competitors because you can spend more than they do on every single advert and on product development.
You can afford to spend more to win every customer - which if you do it right will mean you win more. Plus you’ll make more money for yourself, too.
3. Increase Scale Of Operations Without Impact On Profit Or Service
A business needs sufficient resources to allow it to scale up.
These resources may be people, money (often called working capital), physical resources like office space, technology and tools etc.
A growth business is one that’s able to scale up with resources when it needs them. Many business owners find it hard to scale up because they don't build systems and methods of working, but instead they muddle through, doing far too much themselves.
For example, if you are involved in all of the day-to-day decisions, they become a bottleneck that ultimately puts a cap on the size your business can reach. There's only so much you can personally do in a day before you run out of time.
The same is true of any limited resource - it will become a limiting factor on your business as you grow, unless you've got a way to overcome it.
Business Redesign is Hard
Thinking about your business in this way is demanding and is only effective if you can step back from the day-to-day to see it through fresh eyes.
Most business owners will never boil it down to these three topics, yet if you do, and work to find answers to them, growing and profiting from your business will become far easier.
*What About The 'Lucky Businesses' Mentioned At The Start?
At the top of this article, the idea of a 'lucky business' is mentioned. Massive growth can come from an initial lucky break.
Microsoft got their big lucky break when a young Bill Gates signed a contract to supply IBM with the operating system for the first PC.
The luck of timing and Gates getting himself into the right place at the right time were massive factors, but luck certainly played a part.
In a similar way, some small businesses land a contract with a local council or other large business that accelerates their growth far more quickly than they imagined. But if no further work happens to grow the business, it becomes very vulnerable because most of the business is coming from a single customer.
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