The Stages of Small Business Growth

Your favorite pizza place and the popular Indian corner bistro may not quite look the same, but studies and research have shown that both actually go through exactly the same stages of business growth. They may be physically different, use different marketing strategies, and have different management systems, but they will be bombarded with common problems and issues at relatively similar phases of their growth.

Getting a good understanding of the stages of small business growth and the inevitable challenges, trials, and problems that go with running it is helpful if you want to be able to fairly evaluate your business’s growth pattern and help you figure out what your next steps should be.

1. The Start-Up. This is when you move on from just having an idea to actually doing the business, and this will take a lot of your time, stamina, perseverance, and a good list of first-time customers. It should go without saying that you will need cash or an initial capital investment here. While you will be supervising some help or staff that you have, you practically do everything in this stage. Your primary goal at this point is to exist. 
   
   At this point, you will need to have a clear marketing plan as to how you can identify, attract, and sell to your customers so that they remain loyal and stick to using your products or availing of your services.

2. The Survival. If you have proven the market that you indeed have a product or service that customers have a use for and will pay for that, then you have moved on to the next stage of your business growth: survival. This is tantamount to saying that you need to make enough money to finance growth.
   
   Many small businesses rarely get off this stage. While other business owners may just be content with getting marginal returns for all their investments, there are those that are simply unable to come up with enough financial resources to cover additional costs such as the development of new products or the employment of more people who can help provide more services for the business. This is where you really have to think whether you are capable of running the business; if you think you cannot, then you need to hire one who can.

3. The Success.  This is the point when the business is considered economically healthy. Here, the company is more or less generating profits that can ensure its success. However, it is at this point where you as the owner should look closely on the business’s organizational development, delegation of the management, financial stability, and the like and determine which needs more attention, modifications, etc., and make sure to give it immediate response.
   
   

   

   
   You may also opt to work on new business ideas that you want to incorporate with the current organization or choose to just enjoy the benefits of success or venture into other interests or hobbies. Additional financial resources will also be necessary if you intend to expand the business more.

4. The Takeoff. If you decide to expand, financing and delegation will be your main concerns. It will take a competent and expert management system to be able to handle growth and the every-changing business environment. Note that with the evolving business climate in the market, change is inevitable—and your business’s inability to cope and adjust to it can sometimes be overwhelming.
   
   As a major point in the pattern of business growth, it is in this stage when you have to decide whether you plan to sell your company for a remarkable profit or be a big business name. To do this, it is critical that you know your own strengths and weaknesses, your positive attributes, and your limitations so you can figure out if you really have what it takes to go further and expand.

5. The Maturity. One major challenge that you will have to face head on when managing a mature business is taking hold of your enormous financial resources, and at this point you may already have a whole department handling just this. Finally, you will have to be as flexible and agile as you can to be able to quickly adapt with the ever-changing environment of a competitive market.

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