Organic is a buzzword in a number of industries today, and it always heralds clean, smart and beneficial practices. The same goes for organic business growth. The tenets of this school of business are simple: To grow organically, a company should focus on the customer base itself, make smart investments that will improve that base and produce more income and focus on efficiency and productivity. The multiple aspects of organic business growth feeds into one another, creating a thriving and powerful business model that’s nourished by a healthy, smart system.
Buying other companies, merging with larger conglomerates and any other measure that leads to rapid jumps in customer base are often considered inorganic growth. While it’s a business strategy that some companies take to heart, it can lead to instability or a paucity of services, too rapid expansion or sudden reorganization of management and teams. This can be a potential morale problem as much as a service for financial one. So, especially for startups, the organic model is considered a safer and smarter route.
Looking for some tactics – from personalized magnets to expansion planning – to help your company encourage organic business growth? Consider these four tips.
1. Know your industry and area. You most often see the organic growth model working with small businesses, and these same groups tend to be more geographically defined than large, nationwide corporations. So if you’re looking to pioneer your startup using organic growth, you’ll want to know your industry, your location and your industry’s presence in your location very well. Whether you’re a mom ‘n pop bagel shop or a web-based developer, it’s key you understand the local demand for whatever services you’re supplying. Even with your marketplace is the Internet, it’s key that you hone in on your services and focus on building business in a region.
Simply put, you don’t want to open your bagel shop on the corner of a street with four or five other bagel shops on it. Do your best to fill a niche and you’ll find a built-in customer base.
2. Get customer feedback. Competition is sure to be one of your main adversaries as you’re using the organic growth model. For that reason, as noted by Inc., customer feedback is more important than ever. Providing your customers with exactly what they need should be the core principle of your business model. Finding out what they need can be the tricky party.
For this reason, take advantage of all the opportunities for feedback that present themselves: website ratings and comment boards, questionnaires or feedback forms, suggestion boxes or one of many different software tools or social media sites out there. Many businesses prefer Facebook or Twitter! Consider how promotional bonuses might also help spread word about your company: custom t-shirts, promotional bumper stickers and other great products could help you out!
3. Have a plan and keep everyone involved. You should always plan for growth, although it can be hard to know how quickly it can come. When it comes time to expand your business, make sure that all your employees are ready to take on the changes. From customer service to cashiers and managers, everyone should be prepped and ready to roll.
However, you should also be prepared for when business doesn’t grow according to plan, or sudden deviations set back your prospective “expand by” date. Preparedness is key with this business model.
4. Know – and avoid – the pitfalls. There are potential downsides to organic growth, of course. While it may be the best option for you, it’s not entirely free of risk. But you can improve your chances of success dramatically by knowing the inherent issues that may crop up and preparing for them ahead of time.
As the Houston Chronicle noted, growing a business from its startup stages means a lot of struggling to maintain positive cash flow. Alongside staying out of the red, you’ll need to find ways to improve sales, maintain resources, stay ahead of (sometimes larger) competition and plan for growth. This is a lot to handle, especially when some small business find they’re plateaued in growth, or their plans have been forestalled due to unexpected circumstances. Knowing the challenges, however, can help you stay smart and make good business decisions.
Have you had luck with organic business growth at your company? Tell us about how you grew a business from the ground up!