Three ways to grow your business

October 24, 2023

Most businesses are looking to grow – not all businesses, but most. There are three ways to grow your business, and the way to achieve growth is to focus only on these three things.

But first – why do you want to grow?

We suggest that you answer the following five questions first.

What business are you really in?
Think about Netflix and Blockbuster for this question – Netflix was offered to Blockbuster for $50m but was turned down. We all know what happened to Netflix and Blockbuster, but what went wrong? Blockbuster needed to understand what business they were in – entertainment.

Why am I in business?
Why did you set up your business? Are you there yet, and if not, how will you close the gap

Who am I in this business?
Am I an artist, a manager, or an entrepreneur

Where are you in the life cycle?
Think about the individual, the business, and the industry.

What is next?

So, back to the three ways to grow a business.

1) Increase the number of clients of the type you want
Identify the ideal customer and plan a lead generation and prospect management process to add to the number of customers.

2) Increase the average transaction value of your customers.
You can increase the number of services a customer takes or the price of existing services.

3) Increase the frequency of the times a customer buys from you.

Let’s see the impact of small changes to these three things. As shown below, increasing each of the three things by a small amount brings about a 33% growth. Most businesses can achieve this small change that brings about big results.

Number of Customers

Average Transaction Value [£]

Frequency of Purchases

Total [£]

Current Sales

1,000

500

2

1,000,000

Increase

10%

10%

10%

Increased Sales

1,100

550

2.2

1,331,000

 

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