Businesses go through several phases. It takes a while to start a business and get it established. Then you need to decide whether to continue to run your business as it is or to expand it. This will, in part, be dependent on what you intend to do with your business and what your exit strategy is.
Trying to grow too early or trying to grow when your business is busy with other things - eg the development of a new product - can be a mistake. Make sure that if you do decide to grow, you grow at the right time.
It is also important to choose the right sort of growth. For example, you can grow organically by selling your existing products to new markets, or by selling new products to your existing customers, or you can grow rapidly by buying another business. Most businesses that grow successfully do so by working out what they do well and then doing more of it, so it is essential to know what your strengths are.
To make sure that you go for the right sort of growth, at the right time, you need to work out how your business is currently performing. There are a number of ways to do this and one way is to perform a SWOT analysis.
SWOT stands for:
• Strengths
• Weaknesses
• Opportunities
• Threats
A SWOT analysis will help you to identify what your strengths are and what opportunities are available. Once you have identified these you can decide what sort of growth to go for.
The SWOT analysis will also identify any weaknesses or threats. This could help you to avoid growing at the wrong time.
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