Three reasons why most businesses stop growing
When a business stops growing it becomes vulnerable to extinction, which is how the death phase of any business usually begin. Therefore, there is a need for growth, which might not be often spontaneous but at least should be continuous and steady. Due to the uniqueness of different business, stagnation could be because of several combinations of factors, but some of the important ones are:
Business model includes strategy and innovation, which are just a few among many other factors that lead to a continuous and sustainable growth
Poor marketing strategy
For a business to continue towards a growth path it needs to continuously plan and execute flawlessly. Competitors will always exist in every market irrespective of the market’s nicheness. As Lao Tzu famously quoted, “He who knows others is wise; he who knows himself is enlightened.” Lao Tzu’s quote applies to businesses. Knowing your competitors and trying to anticipate or stay ahead of them is a good strategy at the same it is also important for most businesses to understand what works, what does not and how to leverage on their strength while reducing weaknesses. The most common method of performing a strength and business check is with a SWOT Analysis. Successful business leverage on their strengths for growth even as they explore other opportunities of strength.
Inability to grow market size
When a business can clearly define who its customers are, it becomes paramount for it to identify a new market where those customers exist. A perfect example of a business that explored new market is Uber, which is operating in 724 cities. Business operations in a new market have its burden. If not properly managed can become a liability to the company. If a business has to scale to a new market a proper evaluation of the market is required to provide sufficient data to support such a strategy; in some cases the financial capacity to sustain the move until it becomes profitable. It is also good to note that the ability to increase market size exists even within the boundaries of the market in current service. Inability to increase market share means that the competition will win.
Ineffective customer service
If a customer service from a business is below par, it opens a wide door for customers to churn; the situation becomes more dangerous with the existence of a competitor having a close substitute. Several variables can stimulate the growth in a business of which one of them is referrals. When customers do not get good service, it becomes difficult for them to refer such a business or product to anyone else. A popular quote states, “Trust takes years to build, seconds to break and forever to repair.” Every customer wants attention and quality service. An efficient customer service can spur innovation. A customer’s need must be the priority therefore, it is essential to create new efficient processes, to match the ever-growing demand of customers.
Business growth is dependent on varying combinations of factors such as good marketing strategy, market expansion, to mention but a few. However, growth is certainly not an option but a must for businesses if they must survive and create more value to their customers.