Entrepreneurs need a lot more than just passion and zeal to make sure that their businesses (their babies) grow. It needs determination and smart actions. Here, we are going to explore strategies that can take your "little baby all the way to college."
Following are some methods that can work like "growth serum" for your start-up:
In this strategy, you keep your pricing as low as possible (lowest in the market), so that your product/service becomes the obvious choice for the buyer.
In the case of certain luxury products and niche services, a certain level of pricing (high) needs to be maintained to keep a client filter and stipulate a market for the business.
Mass Production/Increase Outlets
Increasing outlets can help your organization to gain from economies of scale. This means that if you offer more, your cost per unit will be less, thus implying more profit.
Leverage of Tie-up/Alliance
Tie-ups or mutual understandings with other organizations, dealing in related production/services, can indeed help in building and developing more business for both the entities. For instance, a bakery could tie-up with a restaurant. This would bring better sales for the bakery and reduction in cake production cost for the restaurant.
Generate New Value Propositions
Identify new segments that are developing speedily and reach out to them. This way the market will be captured by you, before it reaches its peak itself. You should make efforts to place your product or service in the "psyche" of the client/consumer. This will slowly but surely help you to build consumer confidence.
Keep the in-house costs and overheads as low as possible. Pay your employees adequately, but maintain the other per-head expenses on the lower side of the graph. More so, make sure that all the available resources are completely tapped. Each resource should be utilized optimally and with efficiency.
Location of Production Facilities
In case of product-oriented organizations, make sure that the production happens closer to the source of the low-cost raw material, etc. This can help in keeping the transportation cost at a negligible level, and again, keep the cost as low as possible. This can lead to better profit margins.
You can offer discounts or freebies to your existing clients. You could also give them a commission, if they refer you to their contacts and it leads to sales.
Keep your staff as motivated as possible, so that they work to the maximum capacity. Performance incentives and a comfortable work atmosphere can have tremendous positive impact on the profitability of any organization. For instance, appreciate their performance through awards or certificates, conduct fun activities fortnightly, give personalized company T-shirts (with the logo) to them, etc.
Innovate new uses for your products or services. This will multiply your market and target clients. It can also genuinely add value to your sales pitch.
Show Off Positively
Participate in exhibitions and trade shows. It will involve some investment, but the returns on it will be worth it. More so, your organization's visibility will also be enhanced, leading to improved market presence. You can also promote your product with bigger brands and increase visibility.
As mentioned earlier, a small business has no other option but to grow. One does not need immense and huge capitals for that; just some knowledge, some out of the box thinking, and a little daring. Making calculated risks is surely the way to go.