BUSINESS STAGES
It’s a journey
Money doesn’t grow on trees. But business is like a plant or a tree.
You need to have seeds and plant them. Your business needs to be nurtured for continual growth. It takes time, effort and attention every step of the way.
Each life stage has its own challenges and needs.
A business may not necessarily go through all of the stages in sequence. Some businesses accelerate exponentially and reach the expansion stage quickly. Some businesses were created to be flipped and reach the exit stage even quicker.
We will look at life stages that typically happens to businesses. Find out which stage your business is at so you’ll know what you can do to grow your business.
STAGE 1
SEED OR IDEA DEVELOPMENT
This is the stage where you get an idea. It normally comes at a moment that made you go “I wish there was something/someone that could do this so this problem can be fixed.”
The idea is good but you don’t know if it can turn into a profitable business. It doesn’t have to be an original idea – most innovative ideas are improvements of existing ideas.
STAGE 2
START UP
You have started up your business. With each sale, you are learning to adjust your business model so that it can do better. Adjustments may apply to the product or service, the process or even the pricing. You are using as little money as possible to sustain the cash flow of your business. You are surviving but you will need to put in effort to make more money. The effort you need to make now is different than the first stage.
STAGE 3
GROWTH
You have a clear business model. Your business has an established market presence and so is the client base. You have some regular clients who have been with you for a few years now. Your cash flow is steady and you have some team members who have been with you for a few years now.
You’ve gotten this far because you put in so much effort – blood, sweat and tears. You seriously need to consider if you would like to continue growing the business. If you don’t, your business will be stagnant and all the effort you put in will be wasted. If you built this business to flip it, then now is a good time – but not the best – to do it. If you want to grow it, you will need to look into growth development such as hiring a manager and upgrading to a more comprehensive software system.
STAGE 4
EXPANSION
You have been in business for several years now and you are not involved in the day-to-day operations of the business as you have a strong and professional management team.
You have have a strong cashflow and have expanded your market reach. It looks like you have covered your market. Is there anything else you can do to grow your business?
STAGE 5
MATURITY or REGROWTH
Your business looks like it has reached the peak of its life cycle. You have expanded your market and you have improved your products or services. The only thing you haven’t done is try a new market with a new product or service. You’re not sure if you want to continue with your business or sell it. Even if you decide to diversify, you may have some partners who want to sell the business. You may be interested to push the boundaries but your partners are tired and want to cash out.
