Business growth
Business growth refers to the expansion of a company's operations, revenue, and market share over time. It can be achieved through increasing sales, expanding into new markets, developing new products or services, and acquiring or merging with other businesses. Business growth is a key goal for many companies as it can lead to increased profitability and competitiveness.
5 Key excerpts on "Business growth"
eBook - ePub- Erica Olsen(Author)
- 2011(Publication Date)
- For Dummies(Publisher)
...Chapter 10 Growth: It’s Not Just for Kids Anymore In This Chapter Growing your business using current products and developing new ones Exploring and assessing new market potential Looking at various partnership strategies Finding out about growth through mergers and acquisitions A t the end of the day, what’s every business trying to do? Grow. More customers, more sales, positive cash flow, larger deal sizes, higher volume, more billable hours, justification for higher prices, and so on. Ask any hard-working entrepreneur what he or she is working on and you’re bound to hear a comment related to growth. Growth is why you’re in business — to build or create something bigger than yourselves. Because if you’re not growing, you’re shrinking. With that said, you don’t want to focus on growth for growth’s sake because growth is just the means to an end. Your desire to grow must match up with your vision for your organization. Rapid growth, incremental growth, or maintaining your current position require specific strategies. In this chapter, you discover the different paths for growth strategies. You understand how to travel in more than one direction to find partners and acquire others. Lastly, you look at how to evaluate the different growth strategies against each other to get a clear picture of your strategic choices. Strategizing How to Grow Successful growth stems from matching up your strengths and weaknesses with the opportunities that exist in your business environment. Your growth strategy is the way in which you position your company to exploit your strengths and opportunities and mitigate your weaknesses and threats. By strategizing how to grow, you’re actively deciding how to connect your mission with your vision (see Chapter 6 for more on missions and visions)...
eBook - ePub- Tom Craig, David Campbell(Authors)
- 2012(Publication Date)
- Routledge(Publisher)
...By buying new plant, equipment and by taking on more people to operate them, the business increases its capacity (the volume of output it can produce). With an increased capacity, the business can meet higher demand and accept a higher market share, thus increasing its financial income. The business usually continues to invest its profits over many years, thus consolidating its position. This method of growth is sometimes referred to as organic growth due to its effects on the numbers of people that the business employs. Internal growth has been the prominent method of growth since modern business began during the industrial revolution. Many of the ‘big names’ in business today began as relatively humble small businesses, but which wisely invested profits over the years to arrive at their current size. To rely wholly on internal growth as a means of business expansion has both advantages and disadvantages. The advantages include the possibilities of the building of long-term working relationships which lead to a strong team culture and a sense of security, and even pride in the organisation. Disadvantages include the potential limitations on skills and expertise that may come to light if the organisation continually rejects growth by external means. 7.4 External Growth The second mechanism by which organisations can grow is by external growth. Whereas internal growth occurs by investing profits in the same business, external growth involves using the business’s money to invest in other businesses. This is achieved by one of two mechanisms: mergers and acquisitions (M&A). M&A: What are They? From time to time, major M&A are reported on the national or international news. For example, the year 2000 started with the £112 billion merger of Britain’s the biggest company Vodafone with the German conglomerate Mannesmann. At the time it was seen as the biggest merger in corporate history but was over-shadowed later that year by the merger of American Online and Time Warner...
eBook - ePubThe Investment Checklist
The Art of In-Depth Research
- Michael Shearn(Author)
- 2011(Publication Date)
- Wiley(Publisher)
...CHAPTER 10 Evaluating Growth Opportunities Businesses that are growing profitably create a lot of value. The main advantage of investing in a growing business is that you can receive the benefits of tax-deferred compounding. This is due to the fact that you can hold onto the stock for a long period of time without having to sell it. This advantage has formed the basis of success for many long-term investors, most notably Warren Buffett. Growth does carry many risks. There is uncertainty about any company’s future, but when you purchase growing companies, you are generally paying for future growth as well as current cash flow and profitability. This requires you to determine whether growth can continue, for how long, and at what rate. This chapter is intended to help you reduce the uncertainty of investing in businesses that are growing. Let’s begin by looking at how a company is growing. 53. Does the business grow through mergers and acquisitions (M&A), or does it grow organically? You can answer this question by viewing the cash flow statement found in the 10-K. In the Investing section of the cash flow statement, there is a subsection titled Acquisitions. Calculate the percentage of cash flow from operations spent on acquisitions for the last 5 to 10 years. Depending on the percentage spent on acquisitions, a business can be classified along a continuum of growth styles. On one end would be those businesses that grow organically. On the other end would be serial acquirers. Selective acquirers belong somewhere in the middle. For example, compare the following companies: For-profit education business Strayer Education has not made any acquisitions, but has been growing steadily for many years. Businesses that grow organically are typically not paying a premium price to acquire additional customers...
eBook - ePub- Michael Pirson, David M. Wasieleski, Erica L. Steckler, Michael Pirson, David M. Wasieleski, Erica L. Steckler(Authors)
- 2021(Publication Date)
- Routledge(Publisher)
...We can see growth as a result (i.e., as the dependent variable) of a process of development in which, according to Penrose (1959) “an interacting series of internal changes leads to changes in the characteristics of the growing object” (p. 1). When we study firm growth, the growing object is the firm, and the by far most frequently applied variable to measure the result of quantitative firm growth (or “the characteristic of the growing object” in Penrose’s terms) is increase in sales (Achtenhagen et al., 2010 ; Delmar, 1997 ; Delmar, Davidsson, & Gartner, 2003). Increase in profits, cash flows, and assets are alternative financial indicators and increase in market share, physical output, and employment numbers alternative nonfinancial measures of quantitative growth (Achtenhagen et al., 2010 ; Delmar, 1997). Already Penrose (1959), however, voiced “serious conceptual objections” (p. 199) about the idea that one single measure can adequately capture the amount of expansion of a firm, let alone its internal development and its contribution to improving people’s lives. The second way of looking at growth is to perceive growth as a process of development in which a range of different variables interact. For Audretsch, Coad, and Segarra (2014), for example, “firm growth is a heterogeneous, complex and dynamic process that involves economic, social and cultural factors” (p. 745). McKelvie and Wiklund (2010) have called for more research on “how” firms grow instead of just focusing on “how much” they grow. Actually, there has been a tradition of conceptualizing growth processes as life cycle or stage models (for an overview see Levie & Lichtenstein, 2010 ; and Phelps, Adams, & Bessant, 2007). One of the most widely cited is Greiner’s (1972) five-phase model. According to this model, firms need to go through several transition stages as they meet different types of crises on their growth path...
eBook - ePubMicro Enterprise Marketing
How to Start, Promote and Grow Your Micro Business in the Digital Age
- Sheila Atienza(Author)
- 2021(Publication Date)
- Privilege Digital Media(Publisher)
...In essence, marketing is a component in growing your micro business. But, you may still think about some other things: "When, where, why, and how would I go about it?". Okay, you have your products. You have your target customers. Now, you may wonder, "How many more tasks should I carry out to fulfill marketing for Business growth?". When you were at the early stages of your business activities, you must have been doing already some aspects of marketing. But as your small business moves in your intended direction, you would need to analyze and review (if possible) how well you have done so far. Now, just because your early stages of marketing turned out okay and brought you some reasonable sales and revenue, it does not automatically mean it will continue the same way. Many aspects of Business growth can be associated with change. In our earlier topic on Business Challenges and Growth Strategies, we recognize that a business could go through a life cycle. A business could be in any of the three vital stages: Growth, Maturity, and Decline. As an entrepreneur, where could you be at this point? As you pursue Business growth, you will need to look at your marketing goals. And what comes with that is - the need to identify the current situation in your micro business. Have your needs changed? Remember, what might have worked in the earlier stages of your micro business may not work in the present time. Some marketing aspects that you might need to look into would be your target market, your product or service, your sales channel, your pricing, and even your marketing budget. TARGET MARKET As you pursue growth, you would need to assess the market you are trying to reach. Part of your marketing tasks would be to define (or redefine) your marketing goals. You would need to know whether you are still working on targeting the same market...
