Starting Your Own Business?
Whether you have just started your own business or you are trying to find a way to expand it, organic growth is an effective way to take your company to the next step. For a company to achieve organic growth, it needs to increase output and enhance internal sales. Organic growth does not take into account growth or profit that is due to mergers and acquisitions but instead relies on sales and expansion increases using the resources of the company. Healthy growth can sometimes be hard to maintain in businesses, so there are a few things to keep in mind. Organic growth tips may seem straightforward and based on probability, similar to poker tips; however, there are key steps to follow to achieve organic growth in your business.
5 Tips For Organic Growth
1. Make the market trends your friend
When taking steps toward organic growth in your business, it is important to consider the current market trends. In the last decade, several companies expanded their business in specific ways that increased their exposure to profitable and fast-growing segments, witnessing a 1% to 2% point of TSR each year. By taking this into account, we can deduce that businesses involved in the trend should continue investing to stay ahead. On the other hand, businesses that are going against the market need to reallocate their resources and shift toward market trends. With that in mind, make sure to remember those mature sectors include rapidly growing segments, and many growth sectors have slow sub-industries.
2. Use your resources in a self-sufficient way
Self-sufficiency is a crucial step in the organic growth of any business. Organic growth is a growth method driven by using and relying on your company’s own resources and avoiding collecting debt. If you are wondering where that internal growth should start or come from, consider looking at how a company’s revenue increases to grow in its core industry. This is because it is difficult to achieve successful organic growth without a healthy core business. By unlocking growth in the core of your company as a priority, you are more likely to generate increased growth in the existing markets or the next new markets.
3. Take a diversified approach and create a unique brand image
When taking steps towards organic growth in your business, ensure you keep in mind that there is no one-fits-all approach. Whether your strategy is based on investing, creating, or performing, there are different growth generators for each company, making a diversified approach is important. For example, 60% of business executives say they have one primary organic growth strategy, and the other 40% say that their companies have more than one. A diversified approach is often seen more commonly in larger companies and in developed markets rather than in emerging markets.
4. Create new services and products
One of the primary organic growth methods used by companies today is the creation of new services, products, and business models. Although a lot of successful companies rely heavily on investing, the majority will agree that the creation of services, business models, and products generates tremendous growth. Whether you want organic growth in developed or emerging markets, or both, you should focus on creation as an effective growth tool. In fact, companies that pursue several different strategies but keep the focus on the creation of diverse things are more likely to report successful growth than other companies. However, it is also important to keep in mind that following the creation strategy alone is not sufficient if you intend to report continuous high growth.
5. Improve performance
Organic growth can heavily rely on the constant improvement of internal performance, which can be a key step in healthy business growth. An effective working environment is an important aspect to keep in mind even when technology plays an important role in our work lives. Through encouragement and guidance, employees can develop agility and a level of performance that can only positively contribute to the business. Through the use of strategy reconfiguration and the use of internal resources, the work environment can prosper and grow. With a culture of continuous improvement and learning, by using performance metrics, for example, employees will gain a higher incentive to work quickly, efficiently, and in an agile way.