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How to Break Through 5 Common Barriers to Small Business Growth

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How to Break Through 5 Common Barriers to Small Business Growth

By Caron_Beesley, Contributor
Published: February 21, 2013

Trying to grow your business, but thwarted at every turn by problems within your own organization or by external factors such as broken supply chains?

For many businesses, the biggest obstacle to growth isn’t poor sales, financing or tough competition; it’s often the business itself!

So, if you find yourself operationally ill prepared to grow, what can you do about it? Here are some strategies that can help you break through some of the common barriers to growth that many small businesses experience.

1. Watch the indicators for growth

Before you embark on any growth strategy, step back and take a look at some key business indicators to help you decide whether you are actually ready for growth!

Are you successful in a current market and want to open a new location? Are you about to clinch a big sales deal? Is your sales pipeline full? Is product development success opening the door to new opportunities?

These are all important indicators that will drive growth and should be constantly monitored to ensure you are able to effectively prepare for that growth. Study your pipeline, conversion rates and market trends in dashboard form every day.

2. Keep one eye on your competition, but always think big picture

Underpinning any growth strategy should be a deep knowledge of where you stand against your competition. A simple SWOT analysis, reviewed quarterly, can help you determine where you fit in relation to your competitors and areas of opportunity to exploit your strengths and their weaknesses. Likewise, it will give you a good view of any threats to your growth and guide you towards developing a plan to fix or compensate for these.

Then take a look at your market – your potential customers. Do some market analysis to find out how your customers view your business and what they see in the competition that would make them buy from them instead of you.

Look for ways to differentiate yourself – how does your competition position itself in the marketplace relative to your business? How does your business/product/service contrast with theirs? Why would a customer buy from you and not them? The answers to these questions will help you see your strengths, exploit market opportunities, and execute a tactical plan to get ahead in areas that you don’t measure up to the competition.

3. Always be recruiting talent

Setting the stage for growth has to involve superstar employees. Even if you can’t afford to right now – keep looking for talent and bring them on part-time or on a contract or hourly basis. Another option that can help guide your growth is to work with an organization like SCORE. SCORE provides free business mentoring services and can partner you with someone with business management experience to help you steer your business on a path to growth. Whether you need help across the entire business, or are looking for help with functions such as business planning or marketing, SCORE can pair you with a mentor for free.

Get more tips in 6 Options for Staffing your Growing Business.

4. Constantly assess risk

If there’s one thing being a manager or business owner teaches us all, it’s that we must always anticipate and manage risk. Look ahead—what variables could occur that might compromise or damage your growth plans? These could be supply chain issues, hiring and training problems, competitive activity, cash flow, or patent infringements. Include these in your SWOT analysis and develop a plan to prevent or manage any issues.

5. The bottom line

If there’s a common thread here, it’s the importance of being prepared. This, of course, means having a plan. Never embark on a growth strategy without a plan. It doesn’t have to be encyclopedic, but it should contain the key elements discussed above.  Break your plan down into chunks – have one strategic plan that contains your market findings and helps inform where you are and where you want to be. Then assemble smaller plans. For example, have a day-to-day operations plan, a hiring plan and a marketing plan, each of which lay out the tactics for using your business resources to accomplish your strategy.

If you don’t have a business plan, check out SBA’s Build your Business Plan Tool. This step-by-step online tool guides you through the process of creating an actionable plan.

 

About the Author:

Caron Beesley

Contributor

Caron Beesley is a small business owner, a writer, and marketing communications consultant. Caron works with the SBA.gov team to promote essential government resources that help entrepreneurs and small business owners start-up, grow and succeed. Follow Caron on Twitter: @caronbeesley

Comments:

Another important thing when drafting your plan, especially if you are a small business, is remembering to keep your credit history decent. Do not dive into humongous projects that you know are way too ambitious and can run your company dry of money. Once your credit score drops below the 500's it starts being a real issue. Getting bonded gets extremely difficult, bond premiums skyrocket and getting to a good financial place takes a lot longer.
I hit a high point in my business three years ago and then I had a small hut steady decline. Looking around at other businesses similar to mine some appeared to be declining but some also seemed to still be busy as usual. I tried bumping up my advertising but it was just more money going out the door. I actually contemplated shutting the doors and going back to work. I ended up hiring 5 star business consulting company out of Oregon and it worked out really well. I was overlooking a lot of opportunities. Also they set me up on a long term advertising program and it has made a world of difference! I spent about 5k on the consult and it was the best money I ever spent business wise! Make sure you start a business that you enjoy because it's a lot of work so you have to be passionate about it. Small business is a dying breed, yet we are the heart of America so good luck to all.
This an amazing and very helpful resource for me! You give some useful information about business growthing I have been looking for this for a long time. Thank you so much for this great list!!!
That is very userful for new business like us
Good tips here. When it comes to hiring, be sure to add a careers section to your website - you can create your own using This post was edited to remove a link. Please review our Community Best Practices for more information about how best to participate in our online discussions. Thank you  or share your jobs on Indeed and use their plugin.
This article makes a great point, having a plan is necessity. However, keep in mind that plan will need to be revised over and over again as the market changes, but it is still imperative to have the plan in place as a means to guide your business. A plan serves as a path for your business, and without direction it will be difficult to harness your stregnths and continue to move forward.
Really liked the article ! I am struggling and cant seem to break through some of the phases of small business growth. Here is our websiteThis post was edited to remove a link. Please review our Community Best Practices for more information about how best to participate in our online discussions. Thank you study Chinese , anyone have any idea's ? would be great to have some brain storming and work together get us back on track!
An additional area to consider under risk is credit risk. A sale is only good if you collect on that sale! Too many businesses extend credit to other businesses without getting a credit application or pulling trade credit data through D&B, Experian, etc. It will be tough to do at first, but getting your customers approved for credit will save your business in the long run.
Well, Ms. Beesly, right here in the Netherlands it is not easy at the moment to create growth due to the crisis. Small entrepeneurs simply have to work harder for the same (or less) income and especially never give up. In this time of crisis you may distinguish yourself from others to keep on targeted advertising in stead of saving on this and offer extra services to customers. In the past 5 years I have seen too many small businesses gone bankrupt because the were all "waiting" for the crisis to end...
Great article Caron. I was looking forward for this kind of information. Really helpful and informative one for the small business people. For a successful growth of the small business and its sustainability, go for finding innovative ways to keep your business at the forefront of the targeted customers and to be recognized by them and be in the mindset of the customers. While creating your business network,keep on considering the benefit you may serve to people, who could benefit from your products or services.It is really important being a business owner to be imperative and try to make some operational changes to remain competitive and successful.

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