Growing a business is never easy, but it’s particularly challenging during economic downturns and turbulent times. Many company owners have ambitions to expand, but how do you develop a business growth strategy and how can you grow your business when the economy is struggling? In this guide, we’ll outline some effective steps to draw up a growth strategy and provide advice and tips to maximise the chances of success during difficult periods.
How to develop a business growth strategy
Growing a business is not as easy as finding new premises or marketing products and services to new audiences. To execute a growth strategy, it’s essential to plan meticulously. Expanding a company carries risks, especially at a time when there is a threat of recession and the economy is unstable. If you’re hoping to grow your business, here are some best practice guidelines:
- Outline your target area of growth
There are multiple ways in which a business can grow. Before you invest time, energy and money into expanding your company, outline the target area of growth. Are you looking to boost your workforce, increase sales or open a new branch, office or store? Are you on a mission to sell to new customers in different regions? Are you expanding your product range or adding services, or are you exploring options to sell products via different channels?
It’s wise to pinpoint the key area or areas of growth before you move to the next stage.
- Conduct extensive market research
Growing a company is a gamble but you can reduce the odds of failure dramatically by conducting extensive research before you take the next step. Research the market and the industry as a whole. Identify patterns and trends, analyse sales data and collect feedback from customers and prospective clients. It’s crucial to make sure that you get the timing right when growing your business. Gauge the level of demand and look for positive signs of growth in the industry. If the demand for products or services is falling, or your research shows that consumers have lost interest in the types of products you’re planning to sell, for example, it’s wise to consider your options carefully.
- Establish clear objectives
The next step is to establish clear objectives in terms of the scale and speed of growth. At this point, you know how you want to grow the business and now you can focus on quantifying your goals. Try to avoid being vague. If you want to increase online sales, for example, put a figure on the target and specify a time frame.
- Create a detailed plan
Once you know what you’re trying to achieve, create a detailed plan that explains how you’re going to execute your growth strategy. Outline the steps you will take to expand the business and the tools, techniques and tactics you will employ. If you’re opening new premises for a clothing label, a dental practice, a hair salon or restaurant chain, for example, consider which marketing channels and methods you are going to use to attract customers, raise brand awareness and encourage people to visit the location and spread the word.
How to grow your business during an economic downturn
It’s no secret that the last few years have been incredibly challenging for businesses across multiple industries. The pandemic affected global economies, impacting millions of companies around the world and the recovery has been slow. The cost of living has risen sharply and the conflict in Ukraine is contributing to ongoing uncertainty. In the UK, forecasters have warned of a recession and companies are contending with stubbornly high rates of inflation. The latest growth figures show that GDP increased by 0.1% in November 2022 (source).
Economic turbulence can make it more difficult for businesses to expand but there are opportunities for growth. Here are some tips to grow a business during an economic downturn:
- Identify and understand customer pain points
Economic downturns impact businesses, but they also affect customers and consumers. One of the best ways to engage and connect with customers during tough times is to identify and understand common pain points. Provide help and advice for your clients and try to be creative in terms of implementing strategies that will enable them to continue buying from you. If you stick by your customers during the difficult times, this will pay dividends when the situation improves and consumers have more money to spend.
- Intensify your marketing efforts
It may seem counterintuitive to intensify your marketing efforts and invest more time and money in marketing during a recession or a sticky patch, but it can be a wise move. Most companies will cut back when times are hard. This creates opportunities for businesses and brands that are keen to grow. Try to optimise your ROI and ensure that every campaign has a positive impact. Identify your target audience, carry out market research and focus on the channels and techniques that will help you to create high-quality leads. Build on successful campaigns, analyse data and track performance continuously and eliminate expenses linked to unsuccessful methods and platforms.
- Analyse behaviours and patterns
People respond differently to economic troubles. As a business owner or a marketer, it’s incredibly beneficial to analyse responses, reactions and behaviours to help you decide how to shape your growth strategy and assess new opportunities. Data from the Office for National Statistics suggests that 57% of people spent less on non-essentials due to the rising cost of living in 2022 (source).
- Prioritise top customers
When money is tight, it’s critical to prioritise top customers if you’re looking to bring in new clients. Focus your attention and energy on retaining loyal customers and free up resources for new customers who are likely to spend more than clients that haven’t placed an order or visited a store or office for several years.
- Enhance affordability and value
If the economy is stuttering and growth is restricted, it’s natural to look for ways to lower spending and make your money stretch further. Enhancing affordability and value can help businesses to keep hold of existing customers and attract new clients. Customers want to feel like they’re getting a great deal, especially if they are tightening their belts.
Many business owners have ambitions to grow and expand. Growing a company is difficult, especially during an economic downturn. If you’re looking to grow your business and you’re working on a strategy, it’s crucial to outline clear objectives and targets, conduct extensive industry and market research and create detailed plans. To boost the chances of success during a recession or a period of economic instability or low growth, prioritise top customers, be proactive in helping customers, enhance value and affordability and analyse consumer behaviours. Step up your marketing efforts to seize opportunities while competitors are cutting back and try to optimise ROI.