5 Stages of Business Growth.

All entrepreneurs know that growing a business takes time and has its stages of growth. Aspiring entrepreneurs who get into business without this understanding end up being disappointed and frustrated.

You cannot expect success fast or overnight. It doesn’t happen like that in the business world. It’s a day at a time of effort, commitment, hard-work, pitfalls, and patience.

A business has a ‘systematic’ way of growth. There are few stages involved in business growth and your business is bound to go through them.  

For different factors, some businesses grow faster than others. Different times and different circumstances your business is facing determine the stage your business is. Understanding these stages helps you figure out the stage you are at a specific time and plan for what’s next.

These are the 5 stages your business/ company will go through.

Development Stage

This is the beginning phase or the conception of your business. Your business is more of an idea than reality yet.

In this stage, you have already decided to develop your business idea and need to come up with a business plan.

The development stage is basically your planning stage. You draw the roadmap for your business, how you want it to start, and where you want it to be years to come, and your end goal. During this stage, you come up with your business goals and objectives (what to do to meet your goals).

This is where you address all the important aspects of your business – your idea, finances, marketing, etc.  

Your target market will be addressed in-depth in this stage through research.

The development stage is based on the following;

• Whether your idea will meet the need in the market.
• Whether your target market will accept your idea.
• How you will create your business structure.
• Whether your idea can be transformed into salable products/ services and give you returns.

However, your initial business plan is bound to change as time goes by with some revisions made to meet the needs of your business and circumstances.

Start-up Stage

In the start-up stage, things start getting real and reality hits you as an entrepreneur.

This stage is stressing and most entrepreneurs give up in this stage when almost everything is ‘different’ from what they pictured. For example, your current budget on the ground might be way out of your planned budget.

This is the stage to find customers and establish a market presence for your business. You start building your brand identity in this stage – how your customers perceive and see you.  

Your customer base and market presence is your priority at this stage. The resources to deliver your products/ services to customers on time are also very significant in this stage.

In this stage, compare your products to your competitors and see if you can compete with them in the same market.

Other challenges that might set a pace for your business strongly manifest during this stage with key being;  

• Hiring staff/ employees.
• Acquiring more funding from partners and investors.
• Managing your business accounts and your finances.
• Creating your market presence.

Growth Stage

Remember most entrepreneurs bailout during the start-up stage due to the risks that come with it. Therefore, companies in this stage have already established brand identity, a customer base, and a market presence. With that, they already have some revenue and cash flow coming into the business.

Businesses should now work towards growing their customer base and increasing their market presence.

Internally, the business has more staff to make sure the operations are streamlined.

You acquire competitors in this stage as your brand identity is being felt in the market. And, it’s up to you now whether you stay in the market or not highly influenced by the difference between you and your competitors.

The difference you give your customers when compared to your competitors is what will get you through this stage. What do customers love about your products/services that they don’t find in your competitor’s products/ services?

Think of how you will sharpen your business model and improve how you operate your business and how you deliver your products. What are your key profit drivers- what makes you different from your competitors? Think of how you will increase your profits by adjusting your marketing strategies putting your key profit drivers in mind.

Key in this stage;

• How you will keep up with increased customers and increased revenues.
• Streamlining and restructuring your business operations/ delivery.
• Dealing with competitors and standing out as a brand.
• Increasing your profit capacity.

Expansion Stage

From the word itself (expansion), this is when the business expands or increases its market shares.

The business increases its distribution channels and finds new ways to bring in more revenue and more profit. It also expands the size of the existing company.

In the expansion stage, a company has more products and services for the increasing number of customers.

This is the stage where your business moves into new markets if that’s one of your objectives.

However, before you decide to move your business into a wider market or new markets, do your market research and understand the new markets. Most businesses fail in the expansion stage for failing to understand their new markets.

With increased market share and new markets, you have an increasing market competition as you gain more competitors.

Maturity Stage.

In the maturity stage, your business has rapidly grown year after year and your business idea is now a reality giving you stable profits. You can now predict your business revenues and finances.

You have a strong and solid team of staff/ employees who have worked with you for almost a decade and are core to your business.

In the maturity stage, you can acquire new business entities by opening new company branches. You turn to investors to help you keep the business booming and to deal with challenges that come with this stage.   

Many businesses stay in the maturity stage for years, grow slowly, and eventually if not careful, decline. They start having frequent late payments, decline in initiative, high employee turnover, etc.

In the maturity stage, your business end picture is either a decline or a renewal.

In decline, your business is going down and you might need to look for an exit strategy. You either save it or let it collapse.

With a renewal, your business is back to its expansion stage and you are maintaining your business. You are now adapting to new changes that would otherwise kill your business.

You go back to your drawing board and make necessary changes to your business module fitting these changes. The changes are mostly external such as a change in the market conditions and consumer behavior or new technology in the market.

At this point, the company leadership needs to adopt a new way of doing things and running the business to stay relevant. There is a need to renew or adopt new policies and new operating methods.

As a company, you have to constantly improve your products and services to give the market what it needs.

Decline or renewal is what will determine the failure or the success of your business.

Conclusion.

The success of your business is contributed to by how you adapt in each stage.

As an entrepreneur, having a growth mindset will help you adapt to changes that come with every stage of your business growth.

Everything you do and every decision you make in whatever stage you find your business in will affect your endgame. Make adjustments in your business module and your strategies to make your business adapt to changes that come with the different stages and to prepare for the next stage. These adjustments will affect your long-term business growth.