Last Updated on: 2nd February 2024, 10:29 pm
In one of the trainings I attended, the trainer asked us how many ways there were to grow your business. The other trainees gave various answers. I didn’t raise my hand to give an answer, but I was thinking there must be an infinite number of ways to grow your business, depending on the type of business you have.
Apparently, we were all wrong. The trainer said that there were ONLY three business growth strategies, and that if your goal is to scale, then your daily activities or tasks must comprise of only these three. You should delegate the other types of tasks if you want to reach your business goals.
As an entrepreneur, especially when you have a startup, you’re usually doing so many things that may not necessarily contribute to the growth of your business.
For me
personally, I used to start my day with checking and responding to client
emails (This takes about 30 minutes of my time), then editing or writing any
deliverables we may have (This takes up about six to eight or more hours of my
time). I also assign tasks to my team, provide them feedback, or check on their
progress (this takes 30 minutes to 2 hours of my time). If I have any time
left, I respond to applicant emails and evaluate their qualifications. This
takes another one to two hours.
As you can see, the hours of the day aren’t even enough for me to complete all
the writing, editing, and admin tasks, which means some of them spill over to
the next day, in addition to the new tasks for that day, and so the cycle goes
on.
It seems like an endless routine, and I work hard at performing these tasks well. Unfortunately, none of them lead to my business’ growth, which was why I was feeling stuck.
So how do you grow your business?
Business growth strategy #1: Grow your customer/client base
Marketing is the main, if not the only, way you can grow your customer/client base. You can invest in paid advertisements, such as Facebook ads, Google ads, etc. You have to be able to monitor the performance of these ads for you to determine which ones work and which do not.
You can engage in inbound marketing initiatives. This mostly has to do with content marketing, which means you have to either write and edit your own content or hire other people to do them for you.
You can also do cold calls or send cold emails. This would entail searching for and contacting as many prospective clients as possible. This may also require you to meet them in their office or somewhere.
Another way you can grow your client base, especially if you’re B2B, is to go to conferences and networking events where you can meet and introduce yourself to company and business leaders who comprise your target market.
Note that adding new product or service offerings may not necessarily lead to an increased customer base unless you have identified a clear demand for it. Merely producing more work may also not lead to business growth, although the increased sales can better sustain your business.
In this regard, assess whether a new initiative will lead to increased customers/clients before you invest time and money in it.
Business growth strategy #2: Increase your price
Another way to grow your business is to increase the price of your products or services. There’s no hard and fast rule on when you should increase your price. For me, though, I think that you should increase your price if your current prices are below the industry rates or if your current margins aren’t enough to sustain the business.
The risk with increasing your price is that you may lose some of your clients. On the other hand, this will also allow you to charge new customers and clients higher, which will provide your company more room for growth. Growing a business leads to increased costs, as you will need to hire more people (remember, you need to delegate the admin and operational tasks), so you can focus on business growth initiatives.
Not increasing your price may allow you to keep more clients and attract new ones more easily as well. However, this can eventually lead to you having more work than you can handle without much of an increase in your bottom line.
I’ve read a post on social media where someone was looking for a freelance writer to write 40 1,000-word articles for $34.00 in total. Woah! Whoever agrees to work at that rate will surely get hundreds or thousands of articles to write, but that won’t make them any richer, as it takes time to come up with a well-written article and there are only so many hours in a day. They would either have to kill themselves working quickly to produce high-quality content or they would work quickly without regard for the quality in order to maintain some work-life balance.
Been there, done that…
I’ve been in that situation where, as a freelance writer, I was getting so much work that my health was already getting affected. I was getting paid well, but in the end, the compensation wasn’t enough reason for me to keep neglecting my health.
I then formed a team to help with the workload. This also allowed me to accept more work and to “scale.” I was still getting paid the same rates, though, only then, I had to share the profits—in the form of compensation– with my team. With decreased profits on my part, this meant I had to get even more work. This meant that I (I was still heavily involved with writing and editing) and my team had to work even harder.
I started to consider whether this was the right way of working when even the members of my team started getting sick. They would either quit the job or continue to work even while in their hospital beds.
I really felt bad about it, but I couldn’t do anything as we were doing so much work there wasn’t anyone to pass on the tasks to. In addition, we were being penalized by the client (a writing services provider that outsourced some of their work to us) for late deliverables. The quality of our work also suffered, which led to client complaints.
I took all these experiences and mistakes into consideration when I formed my own company. I made sure that we were better compensated for our services and that the deadlines were more realistic to ensure the quality of work we wanted to produce.
However, it wouldn’t take long before I realized that the patterns were repeating—we were again getting more work than we could handle and the quality was starting to suffer. As such, I started to grow my team by hiring people who can take over some of the tasks that I was performing.
The way to growth…
By increasing the price of my services, we will have more room for growth, especially since the services and tools we use to complement our services have also increased their prices. We may lose some clients, but by increasing our prices, we won’t have to take on as much work to earn profits and to sustain the business. This will also allow us to better maintain some work-life balance and better ensure the quality of work we deliver, making it a win-win situation for everyone.
I kind of feel bad and guilty for increasing our service rates, as they would hurt my existing clients who have all been very good to me. I feel, though, that I’ve been short selling myself and my team as I realized that after two years, the price I was charging my clients was far below the industry standards. I sort of intentionally priced our services on the lower end in the beginning just so we could get some skin in the game, but It simply wasn’t realistic for us to keep charging at the same rates two years later. These are only some of the lessons I learned about growing a business.
Business growth strategy #3: Lower your cost
The third and final way you can grow your business is to lower your costs.
If you’re a product-based business, you can do this by having your products manufactured offshore or by sourcing your materials from vendors that sell them at a cheaper price.
If you’re a service-based business, you may outsource the work to offshore service providers or freelancers. You don’t have to hire regular employees for all the tasks, especially when you’re just starting out and don’t really have much work yet.
You can also reduce your overhead costs by finding ways to reduce your rent and other expenses.
I currently work from home and have a virtual team of freelancers. This setup works great for me, as I don’t have to spend on transportation, office space, and other office expenses.
By having a virtual team of freelancers, I don’t have to hire regular employees. This is especially helpful for me as a startup where I’m still building my client base. Freelancers get paid for every piece of work they complete whereas regular employees are paid by the hour regardless of whether there’s work or not.
This setup also conforms to my lifestyle. I am sort of a workaholic and working from home allows me more time to work than if I had to dress up and commute to work everyday. It also allows me to work from anywhere, even when I’m travelling.
So there. There are only three ways to grow your business—grow your customer/client base, increase your price, and decrease your cost. The ways to achieve these can be different for each business. But to determine whether you’re leading your business to growth or not, assess whether your day-to-day tasks lead to the growth of your client base, increased prices, or reduced costs. If not, then you should perhaps rethink the type of work you put your time and energy into.
How have you grown your business? Do share below what initiatives you took to drive growth.
