How To Do Good Business In Hard Times
Every business demands growth, and double-digit growth is the dream of every dedicated
business owner, even when lackluster results show up at quarter's end.Most entrepreneurial business owners need a guide to navigate their way toward substantial, sustainable growth. It can be done even in a slow economy as demonstrated by such companies as Harley Davidson, Starbucks, and WalMart. Even smaller companies such as Paychex and Oshkosh Truck have been able to make gains in revenue, gross profits and net profits.
With that said, here are 5 disciplines of sustained growth:
The first is to retain your customer base. Yes, keeping the growth that you have already earned by coaxing customers into complex relationships that make it a hassle for them to switch to your competitor. Put a strong emphases on tailoring your products/services using data gleaned from your customers giving you an advantage. Be proactive in managing customer defections will help you anticipate and pre-empt them. Work hard at bonding with customers wherever emotion is tied to an interaction is another great way to retain them.
The second key element is to gain market share at the expense of your rivals. Give customers a reason to abandon a competitor's product and or services for yours. Do what it takes to lower the switching costs. Pulling customers away from a competitor can be difficult, so you must devote many resources to raiding their customer base. Offering higher value and quality are crucial to this end. One way of doing this if you have the resources is to buy the competitor out.
The third discipline of sustained growth is to exploit your market position. Show up where growth is going to happen by spotting it early. This can be done by watching the industry for shifts in buying criteria, product or service innovations, and population trends. You must be able to spot positioning opportunities to make the most of them by continually using a systematic approach to the process.
The forth point is to invade adjacent markets. Yet, before moving into a nearby market, decide whether it offers significant long-term growth and profitability. Determine whether you have an advantage over a competitor, and ensure you can match its standards of quality and value.
The fifth discipline of sustained growth is to invest in new lines of business. If you take this approach, never overpay for a new line. You must find simple strategies instead of complex ones, and partner with the new business by assessing its leadership team and balance sheet.
Although a successful growth portfolio might not include all five of these disciplines, it must contain more than one. Only a balanced growth portfolio can keep an organization growing when the market shifts dramatically.
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