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Planning for Growth
So you want to grow your business? A good place to start is to decide ‘in which way(s)’ you want it to grow.
There are a few different ways you can approach planning for growth. Here are a few tried and tested methods that are very effective in helping businesses to plan for growth and achieve it.
Setting goals for growth
Start with the end goal – what is the result you’re looking for? Keep it broad and open. Record all of the ideas you have relating to what the end goals might look like and make them SMART (Specific, Measurable, Achievable, Realistic and have a specific Time against them) e.g.
Be able to fulfil 20 orders a week of n.
Get one new client a month for the next 12 months.
By the end of the year, be able to build x in-house and not have to outsource it.
Within the next six months, set up social media channels for the business and know how to use them to gain new business.
End the financial year with an average profit margin of 15% across all orders.
If you’re struggling with this, try the SWOT analysis method first – you may find that this will uncover some growth opportunities that aren’t obvious at first thought.
Once you have a list of end goals, start with the first one and work backwards asking ‘why?’ until there are no more steps needed to achieve it. This will give you a starting point for what you need to do to achieve your growth goals.
Here’s an example:
Be able to fulfil 20 orders a week of n
How many orders does your business fulfil now? 10
Why do we want to fulfil 20 orders a week instead? Because our existing customers would like more of n, but use them faster than we can make them.
Does our current level of staff mean we could produce 20? Yes, but not if someone went on leave.
So why don’t we produce 20 a week when all of our people are at work? Because our n machine can only produce 10 a week.
So it appears to meet this goal, we need to:
Look at our staffing levels and what skills they have. There could be an opportunity for additional training so that production’s covered while people are on leave.
There could be purchase needed of a new n machine.
There could also be different ways we could try to improve our production processes and ways of using the existing machine to make it more efficient and produce more ns with what we already have.
Once you’ve completed the SWOT analysis, have a look at where there are complementary factors between sections and how these might become items to add to your growth planning.
For example, the physical therapy business owner being solely responsible for the admin and finance tasks appeared in the Weakness and Threats sections.
One growth goal might then be ‘Find external resource or hire a staff member part time to manage admin, payroll and finance functions.’ This would free up the business owner on the weekends, be a more efficient use of their skills and time, allow invoicing to be done in a timely way and improve cash flow.
A SWOT analysis is a structured business planning method that will help you to gain a broad overview of where your business is now and where the opportunities for growth could be. SWOT stands for Strengths, Weaknesses, Opportunities and Threats. It can also be helpful for decision-making around the benefits of a potential business opportunity or project. The Strengths and Weaknesses section refer to conditions inside/internal to your business. Opportunities and Threats are to do with external factors.
Strengths is where you list all of your businesses current strengths. What is your business really good at? What do you have that no one else does? What do you do that’s excellent? What are your other benefits? What are your assets?
For example, a physical therapy business might have:
All of our staff members are qualified personal trainers and physical therapists. We don’t need separate people for each therapy area.
We get constant patient referrals from our network of GPs and clinicians who know what good work we do. As a result we don’t have to advertise for business.
Our overheads are low because we don’t need require desks or large office space. We travel to our patients most of the time.
Our patients really like us and many have become personal friends.
If possible try to ask people outside your business why they like doing business with you or what they see your businesses strengths as. They’ll have a different perspective to yours and may tell you things you didn’t know that will be useful for your planning.
Weaknesses is where you detail what gaps you might have in skills, capability or infrastructure that cause you problems or are preventing you working in the way that you or that your customers would like. What could be improved? This could also be things your competitors do better.
Back to the physical therapy business example:
When a staff member is ill or injured, we can take a long time to reschedule appointments and often let patients know at very short notice of the cancellation of their session.
The business owner spends all day on Sundays doing the businesses admin and timesheets. Invoicing often takes weeks to get done. Our customers can then get several invoices at once and this inconveniences them and affects our cash flow.
Managing the physical records of the patients is painful. They’re all kept at the office, but staff members have to remember to take them and return them after a session. They’re not always up to date and the patients sometimes have to fill in the gaps at the next session, which isn’t ideal.
Opportunities is the area where you detail which external factors could provide opportunities for your business. These could be to do with the economic climate, lifestyle trends, a competitor going out of business, or changes in legislation that relates to what your business does.
The Opportunities for the physical therapy business example could be:
In February next year, the NHS will allow patients to choose which physical therapy clinic they attend and will no longer require the patient to pay the provider upfront.
In 12 months the NHS will have a digital note-taking platform available free of charge for physical therapy clinics to use to manage patient records.
The University near our office has physical therapy degree-level students. We could approach them about taking students for industry experience placements.
A new science and medtech park is being built nearby. Perhaps we could move offices and have a bigger space, so patients could come to us and use specialised exercise equipment.
Threats are about the external factors could have a negative impact on your business’s performance. This could relate to changes in your customer base, the regulatory environment, technology, or the personal circumstances of staff members. They can be current or potential ones and it’s good to include a couple of ‘worst case’ ones in the list as well.
For the physical therapy business, these could be:
An illness in the owner’s immediate family or the owner themselves, requiring weeks off work. No one else knows how to do the admin and finance tasks.
Another physical therapy business opening in the immediate area that is aggressively marketing to the local area, including to the GPs and clinicians.
The NHS bringing forward the date that all therapy practices have to digitise their patients’ e-health records.
More than one staff member requiring leave at the same time for good reason.
Researching and understanding who your direct competitors are and what they do well/not so well may give you ideas for your growth planning, help you understand your customers (or potential) better and see where you’re already doing well.
Most importantly having a good idea of who else is out there and doing what you do, will show you what choices your customers have and who they’re comparing your business to. Thanks to advances in technology, it’s now possible for customers to compare multiple companies, their services and products through the convenience of their smart phones or tablets.
There are multiple ways you can do competitor analysis. These include:
Using the major search engines on the internet (such as Google) and entering the key words you’d associate with your own company and the area you work in.
Asking people who use similar companies/services to your own, “what three companies would you recommend me to and why?”
Checking with the industry bodies and professional organisations that cover your sector. Who else is located near you?
Once you have a list of names, start a spreadsheet or similar to capture their:
Key messages and claims
Who you think they’re aiming at
Your overall impression- as a customer, would you like them/not? Why?
What their best feature is
What could do with improvement? What do you do differently?
Most of this information will be on their website, but you can also request or download brochures, or even phone them and ask some questions.
Once you have this information, you can use it to guide your own marketing, sales or service offering.
You can also use it as inspiration for your growth goals if they’re doing something particularly well.