Three Stages of Business Growth (And How to Handle Them)

Every successful company inevitably goes through common stages of growth. Each of these phases comes with a set of similar challenges that the company has to address. This article tackles the three major stages of business growth and how to handle them properly:

In business, as in life, there’s a time for everything. Knowing which stage of growth your business is in will help you make the right decisions at the right time and take your business to the next level.

Business Life Story in Three Acts

For the sake of simplicity and practicality, we are going to focus on three stages of business growth: early growth, stagnant growth, and renewal/decline. Why? Decisions made at these times will have a crucial effect on the future of your business. At New Perspective, we help businesses at these critical stages of growth to make decisions that will help them grow and succeed.

Each stage comes with its own unique challenges to solve. To help you navigate through this shaky terrain, we will explain the common challenges—and possible solutions—that come with each phase of growth.

The Early Growth Phase

Every beginning is hard. You’ve invested time, energy, and money into a business idea you believe in. Now, it’s all about the execution.

The clock is ticking:

• Investors want to see opportunities in your pipeline
• You need a certain number of quality leads to support your sales target
• You may have to prepare for launch at big events, such as trade shows or virtual events

As an early stage business, you need to prove your idea can work. If you’re successful, you will generate enough revenue to expand the market on your own, or you will create a strong case for the right investors to help you scale up. Marketing will play a crucial role in this phase.

You will need to:

Do your research. Validate your business hypothesis by conducting customer and market research. Before you’re ready to launch full-scale customer acquisition, you need to have a detailed profile of your ideal customer (or customers) and a clear image of your position in the competitive landscape. These insights will inform your marketing and brand strategy.

The Maturity Phase

We have found that, for many businesses, this is the stage where growth may begin to stagnate. After your explosive initial growth, your numbers are starting to stabilize, or even go down:

• You fail to hit your monthly, quarterly, or yearly targets
• The industry may be growing faster than you
• Your competitors are growing faster than you

No matter how successful your business, your growth is eventually going to slow down. When that happens, it’s time to make some changes:

Evaluate your strategy. Based on ongoing market and customer research and the goals you’ve set, reconsider your business and marketing strategy. Is there an opportunity to open a new market? Does it make sense to expand your offering? Maybe there’s room for both. By keeping a close eye on the market, the competition, and the target audience, you will identify new growth opportunities and adjust your strategy and tactics accordingly.

The Decline/Renewal Phase of Business Growth

The most dangerous thing at this stage is to become romantic about the way you used to do business. What got you here isn’t likely to get you there. New technologies, consumer preferences, or market conditions can steer any company into irrelevancy. In fact, this may already be happening:

• Has your industry been in decline for several years?
• Are you losing ground to new competitors?
• Are changes in society and technology hurting your business?

If none of these statements are true, your business still needs to adopt a culture of innovation, keep investing in customer and market research, and invest in research and development.

Want to know more? Head on over to the full article here for more ideas and perspective. Afterwards, why not drop me an email to share your thoughts at robert@vicleaders.com.au; or call me on 0467 749 378.

Thanks,

Robert