Kelly Deis owns Turning Point Financial, a management consulting firm offering strategy, finance and operations consulting services to local businesses.  She is also a volunteer mentor for Accelerate Kitsap, a nonprofit business mentoring organization that helps local business owners grow their companies. Accelerate Kitsap mentors are experienced business and professional people who volunteer their time to help entrepreneurs solve problems and find ways to take advantage of new opportunities. You can learn more at AccelerateKitsap.org. 

1. 3 Essential Steps When
It’s Time To Grow Your Business
By Kelly Deis, management consultant and volunteer mentor for Accelerate Kitsap
1. Decide to Grow
Should you grow your business? It is a simple question with an assumed answer. The
answer is, of course, is that you should want (some will say need) to grow. I am not sure
the answer is quite so simple. Growth takes time, energy and money. And, there are
inherent risks – if you are not successful, some costs may not be retrieved. And, if the
plan is not well executed, it can take focus away from your existing business.
If your business is well-established, has a loyal customer base, is reasonably protected
from the competition, profitable and affords you’re the lifestyle you have sought (both in
terms of discretionary income and time) then think hard before you take on an
expansion strategy. Make sure you understand what you want to achieve by growing.
There are good reasons to grow a business. You might need the additional revenue to
offset established (fixed) costs required to run the existing business, such as IT,
accounting, rent and the like. If the incremental sales don’t come with additional costs,
then most of the revenue will fall to the bottom-line. An example of this would be
increasing retail sales without adding staff or store hours.
You might believe that you need to establish critical mass in your particular marketplace
to defend against potential competition or to entrench yourself in the market. If you have
significant market presence and are perceived to deliver high value – customers will
start to find you. There is a lot of value to being ubiquitous!
You might have investors or a board that demand ever-increasing top-line and bottom-
line growth. Or, perhaps you want to sell the business in the future. Investors and
potential buyers place a lot of value on growth (or the potential for growth).
Lastly, it is simple human nature to want to be bigger and better. We all take pride in
what we do – and for some that means employing a certain number of people, making a
certain amount of money or having an undeniable market presence.
So, take a step back and decide if growth is something you even want to consider. And
if it is, know your motivations – strategically, financially and emotionally – before
embarking on an expansion plan. It is always best to plan with the end in sight.

2. 2. Identify the Opportunity
The first step in growing your business is to identify where your most likely opportunity
for additional revenue might be. There are several possibilities you can consider, all with
varying levels of risks, effort, cost and potential rewards. Starting with the strategies with
the least amount of risk (and growth potential), they are:
a) Sell More to Your Current Customers
The strategy with the least risk, cost and level of effort is simply to sell more of the
current product to existing customers. If you own a café, it might mean selling a muffin
to the customer that generally only purchases a latte. Or, perhaps you can identify new
ways for your customers to use your product – like turning baking soda into a
deodorizer for their refrigerator
b) Expand your Market
The next strategy is to sell more of your current product in an adjacent market – such as
another city or state. If you are a retailer, that might mean opening sister store(s) in
nearby towns or malls. This strategy is a bit riskier than the first in that there are
additional costs to enter the market and increased management required to oversee the
new territories.
c) Offer New Products or Services
This strategy entails offering new products to new and existing customers. For instance,
If you are a manufacturer of wood doors, perhaps you can extend your manufacturing
capability to include garage doors. It is far less risky to sell new products to existing
customers rather than developing new products and selling to a new market.
d) Develop Additional Sales Channels
This strategy involves accessing customers in new ways. For example, if you
manufacture consumer products, you might expand your market through the internet or
access additional distributors. This strategy is risky in that it requires accessing new
channels or markets that you may not have any prior knowledge.
3. Make and Execute a Plan
Each of the growth strategies described above requires some amount of risk,
uncertainty, cost and effort. It is best to start with the least risky strategy and expand into
other strategies from there. If possible, test the market first before fully committing.

3. Consider your expansion strategy as if you were starting a new business and apply the
same rigor. It will require, after all, a certain amount of investment and on-going cost
and management. Hopefully, in return it will produce enough revenue to give you an
adequate return on investment.
Choosing to grow your business is not only a strategic and financial decision – it is also
a personal one. Sometimes the decision to grow is not an option – current revenues just
simply don’t support the cost structure. Or, it is a defensive play – if you don’t expand to
fill a vacuum, then a competitor will, thus jeopardizing your current position. Or, it is part
of a larger strategy – maximizing value of the entity so you can sell the company and
enjoy a comfortable retirement. Or, perhaps you decide to grow just because you see
the opportunity. Or perhaps you decide not to grow - the business is prospering, has a
loyal customer base and you are content with your lifestyle.
In any case – be thoughtful. If you decide to grow, determine the best strategy for you
and your business. Then, make and execute your plan.
------------------------------------
Kelly Deis owns Turning Point Financial, a management consulting firm offering
strategy, finance and operations consulting services to local businesses. She is also a
volunteer mentor for Accelerate Kitsap, a nonprofit business mentoring organization that
helps local business owners grow their companies. Accelerate Kitsap mentors are
experienced business and professional people who volunteer their time to help
entrepreneurs solve problems and find ways to take advantage of new opportunities.
You can learn more at AccelerateKitsap.org.