As your company grows you will sell more products or expand your service offering. However, your company’s growth should not be limited to just expanding what you have but also new areas for potential growth. Before you can venture out into something new, you need to know how to identify the areas of growth.
Areas of growth within your business are the departments or parts of the business that can be expanded. In some cases, this means creating a new product or service within your business.
With the growth of technology and new business ideas, you can find the right growth areas by developing a robust growth strategy.
Growth Capabilities vs Opportunities
Before you can take on the opportunity to grow, there is some evaluation you need to do. Most companies will look at their capabilities in relation to any potential areas of growth. This evaluation step is important because you will be able to identify if you need to go into product development or service expansion.
This is also vital for knowing how much you should invest in your growth. Additionally, this will allow you to find any applications or technology that can help you scale more easily and quickly.
If you identify new markets to explore and can see that the opportunity will bring about long-term value, then you need to invest. This means anything from getting new staff or dividing your current staff to tackle the new venture.
Once all the research is complete and you feel your business is ready for growth, you need to identify the areas of growth.
Identify Areas of Business Growth
The following steps will help you find new opportunities for business growth.
Step 1: Consult with Your Customers
Your customers are the best resource when it comes to insights for growth. They trust your company and will be eager to try any new offerings you may have. If your customers like a certain product or service you have, you can expand it.
Alternatively, if your customers tell you about what they would like you to offer them that’s new, you can look into introducing that service or product.
Step 2: Identify Essential Areas for Growth
Now is the time to put in some research. You will need to analyse market trends, your company sales trends, any customer pain points and new areas of customer interest. Additionally, you will need to have a better understanding of your year-on-year product and services growth as well as cost of goods sold (including variables).
If your company has a range of related offerings but your customers are buying one product or service, you can look into customer needs and see how they align with your business’ value proposition. This can give you new ideas for cross-selling and new revenue streams.
Step 3: Look at the Potential for Profit
Once your areas for growth have been identified, you need to analyse the potential for profitability within each area. To do this you can develop a viability model which will help you identify and understand the variables needed to ensure your new venture is profitable.
Some of the variables you need to analyse include competition, market size and cost of innovation. After conducting your analysis, you can employ your feasibility model to gauge the predictability and scalability of new revenue streams.
Step 4: Look at Market Fit
When looking at market fit, you need to ask yourselves questions such as:
- Is there an existing market for the product or service?
- Will customers be ready to buy it as soon as it launches?
- What are the potential challenges for your customers?
This will help you see if your areas of potential growth are a logical extension of your business. If the areas of growth don’t fit your business model, you might need to reevaluate them and find others.
If your research comes back positive and your new growth fits into the market you want to penetrate, then you will be able to grow in key areas and expect profit in the long term and possibly short term.
Growing your business is not an easy decision and should not be taken lightly. Some things to always keep in mind include:
- Understand what your audience wants and needs.
- Create a vision for your business growth.
- Strategise your brand so that your customers stay connected to it.
By following this article, you can gain a better understanding of any areas of growth that are available in your business. Do your research properly and growing your business will be easy and seamless.
For more information on potential growth industries, read our article about The Top Ten Thriving Industries.
