Resources to learn how to grow a business
July 02, 2020
by a searcher in Chicago, IL, USA
Hello,
Are there any resources available to learn how to grow a business? I've more of a cost mentality but I would love to learn the growth side.
TIA!
from Princeton University in Annandale, Clinton Township, NJ, USA
As a disclaimer, my views are coming from an investor's perspective, so take that for what its worth.
When most people think of business growth, they think of growing the top line (revenues). In reality, it's the bottom line (profitability) that matters. Someone once told me that revenue growth is about ego, but profitability growth is what matters. Revenue growth doesn't do anything for you if it doesn't translate into profitability. When you think about a company in this context, it's much easier to break down profitability growth into bite-sized pieces. To grow your profits, you can:
a) reduce your costs, or
b) grow your revenues faster than your costs
Most businesses are constantly trying to tackle both of these simultaneously. Keeping costs low is a battle fought on a daily basis inside every organization. Every dollar saved is a dollar earned, and the dollars earned can be either pocketed or reinvested for growth.
Revenue growth can come from three primary areas:
a) bringing on new customers,
b) selling more products/services to existing customers, or
c) increasing your prices on existing products/services
Again, businesses are usually trying to do all three simultaneously. When you combine these two basic frameworks, you'll be better equipped to think through ways to grow profits for any company.
Another resource that may be helpful: the book "Simple Numbers, Straight Talk, Big Profits: 4 Keys to Unlock Your Business Potential". Despite the gimmicky title, it may be a solid resource to better understand the drivers of business growth.
Good luck!
from University of British Columbia in Vancouver, BC, Canada
And what limited info there is, is largely focused on cutting costs, when topline growth is likely to have a much bigger impact long-term.
As someone with a background in marketing consulting for independently-owned lower-MM businesses - many of which fit the typical search "profile" - I've been considering writing a series of articles on how to grow a search business post-acquisition.
Thought it might be especially helpful since the correct way to do this for many "old-school" industries is actually quite different from what you read in a lot of the digital marketing "thought leadership" articles coming out of Silicon Valley and other online/tech publications.
Would anyone here be interested in such a series?