How to Measure Business Growth?
To check whether your business expansion strategies are working, one should know how to measure the business growth. There are certain indicators through which business growth and expansion strategies could be assessed, including:
When the amount of company assets increases, surpassing the liabilities, it's a sign that your business is doing well. The ability to accumulate more assets shows your company's growth.
Number of employees
Another indicator revealing your expansion strategies are working is when the number of employees increases.
Total output implies the sum value of goods and services produced by your business monthly or annually. If the total output or productivity is high, it implies business growth.
Number of customers
Increasing customers also denotes business growth. But if the customer retention is poor compared to customer acquisition, your growth plans for the business need repositioning.
A direct measure of your business growth is revenue. It shows how much money your business is generating. The scope of business expansion enhances with more revenue.
The amount of profit your company or business bags also measures your business growth. Profit is a sure-shot indicator of whether you need to modify or change your business expansion strategies or not.
Market capitalization refers to the company's total share issued to the general public. This indicator is usually applicable to public limited companies. As the stock prices are dynamic, this measure is as stable as others.
7 Effective Business Expansion Strategies
An expansion strategy is a plan devised for business expansion. If you are wondering about how to expand business or how to devise a growth plan for the business, or how to increase business growth, we have seven business expansion strategies for you to try.
Market Penetration Strategy
One of the most common and effective types of expansion strategy is market penetration, i.e., increasing your company's market presence in the existing market. Market penetration could be attained in two ways- horizontal or vertical. In horizontal market penetration, business expansion occurs by increasing advertising, spreading the brand's name to other products, or introducing better products. Vertical market penetration focuses on business expansion through increased production, lowering prices or creating new products.
Marketing and Promotion
Devising a full-proof marketing strategy promoting your products and services also directs company growth. Market your products through the right channels and target audiences by analyzing their behavior and buying patterns. Google analytical tools could be handy if you wish to dab into digital marketing and promotion.
Expansion into a New Market
Expanding the market scope and entering a new market is another effective business expansion strategy. It gives a new and continuous opportunity for business growth. Ensure you conduct thorough research, understand the potential customer, analyze the need of your service or product for the target audience, generate brand awareness, find the right partners and build a strategic market development.
Expand Business Abroad
A global expansion strategy is another way to go for business expansion. Expanding business internationally could enhance your company's revenue, operations, and market share. You could also diversify your company's culture, expand the company's assets and find the required funding for business expansion by transitioning to a global scope.
Franchising is another proven business expansion strategy. Entering a new market becomes easy with franchising as the business owners have to pay relatively less. Its easier for business owners to gain access to market knowledge in different areas once they partner up via franchising.
Entering Joint Venture or Acquisition Agreement
A business partnership is another way of facilitating business expansion. Especially if you are a start-up or entrepreneur, entering a joint venture could ensure company growth for both parties. Merging is also a good option for business expansion, especially when your business acquires a smaller company or grows in size, resources, and human resources.
One of the most effective ways to drive up sales and business. By introducing and developing new products, you could attract new demography or customers and increase the consumer base. Diversifying your product lineup creates additional potential for revenue generation, sales, brand awareness, and market expansion.
Basic Tips on Business Growth