While waking up this morning I suddenly found myself having a pen in my hand and scribbling 2 ideas for a new blog post on a piece of paper. Here is the first one.
Probably you can help me out and post as a comment, who had said the following originally.
“If your business doesn't grow it dies.”,
It is certainly true.
As the population grows, as markets grow, someone else will takeover your niche soon. If not, you are in the wrong market and hopefully close to retirement with enough retirement funds saved.
What are the drivers:
- Number of sales
- Average sales price
So why would you like the product of those variables to grow continuously, strictly monotonically?
This is not supposed to be a scientific article. No. I only want to get you engaged thinking about those issues in your own business. So I really only give you a short list and not much more.
Let's start out with a solo entrepreneur, because it's real easy to start thinking from this point on and the rest applies for big corporations as well.
Here is my Top-10 list, why your business needs to grow:
- 1. Limited personal capacity
- You simply cannot work more than 24/7, which is 24 hours a day, 7 days a week, 366 days (Yes, 2008 is a leap year. You probably noticed on Friday.) Believe me, you cannot do even that. I would know.
The heaviest working week I ever had was, I believe 1987 or 1988, when I put in some 105 hours! I was assistant manager to a very successful restaurant and discotheque owner at this time. We opened up 2 new bars in that week. I remember that figure that well, because I had to fight for getting compensated fairly for this heavy duty overtime.
Back to the point: Once you start outsourcing, you increase your cost that has to be compensated for. Right? Means you need to grow.
- 2. Inflation
- Ever wondered why you cannot buy bread for 5 cents anymore?
- 3. Investments
- By it's very nature investments help you to increase profits, but there are 2 types of investments. You can decrease costs or you can increase revenue. Ideally you should do both types. Then your business will grow.
- 4. Markets Grow As Economies Grow (normally)
- If a market grows and you stand still, you are actually shrinking.
- 5. Competition
- If you stand still, you cannot gain or defend leadership in your market. There is a huge competitive advantage for market or industry leaders. Don't miss that.
- 6. Increasing Financial Needs
- Isn't it natural that anybody wants to earn more over time and actually deserves it (if the work attitude is right). You as an owner, your employees, your contractors, and the Tax-man. How to do it? Grow.
- 7. Enjoying Your Seeds
- The more freedom you want to have from your business, the more it has to perform without you. How? Grow
- 8. Stability
- A bigger, stronger business is more likely to fight any economic, environmental (or even political) threats successfully. How to get there? Grow.
- 9. Compelling Offers
- The more you can rely on the overall fact that your business is growing, the more compelling offers you can make your prospects and clients.
- 10. Using Full Potential
- If your business is not growing you simply don't utilize its full potential. It means that you don't leverage its own momentum. If you are using all your business assets the right way, it's natural that your business will grow continuously.
Well, as I said this is not a scientific essay, just a couple of thought. Tell me what you think. Leave a comment below.
John W. Furst
P.S.: I won't forget the 2nd blog post idea that I mentioned. Don't worry, I wrote it down as I said.
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