The 5 stages of business growth in entrepreneurship are simple footprints that need to be taken if one aims to experience massive growth in the business area in which one has chosen to thrive.
However, small or big the business is or is intended to be, these few selected tips, which are centered on letting you know the stages into which businesses could be identified as growing, will no doubt be beneficial.
Learning is knowing. This knowledge goes beyond just being an advantage to you, it is an opportunity that has come prepared in order to prepare you and to provided a doorway of success for your business intentions and then watch it as you grow into a business empire that is not bound by any sort of limitations.
The knowledge that shall be read below are stationed to help you understand the different stages that there are, and of course it teaches you the indicators that help you know the stage on which your present small or big business is standing.
Check out the 5 stages of business growth in entrepreneurship which you will need to be conscious of:
Existence
In the first stage of business growth, a company is a true startup in every sense of the word. In this stage, the owner basically is the company. All businesses in the existence stage face a few common challenges which include:
- Determining whether or not their product or service will be accepted and/or desired by enough customers to remain viable
- Finding out whether or not the company will actually be able to create sound enough processes to deliver their products or services to an acceptable standard
- Determining whether the company will be scalable and able to meet the customer demand as it increases
In this stage, the business owner is responsible for just about everything, even if they are able to hire a few employees to assist with these early processes.
The goal during the existence stage is simply to survive because many do not. In this initial phase, it’s easy to fail because there are so many reasons why brand-new businesses do not survive past the startup phase.
The business might never gain enough traction with customers, the business could run out of operating capital, or the owner might simply wear out under the immense demands on finances, time, and energy in addition to the pressure of attempting to run a startup.
Survival
Businesses that survive the existence stage, move into phase two, survival. During the survival stage, a business has already demonstrated that its products or services are viable, that customers want them, and that customers return. However, the company has not yet demonstrated the ability to balance revenue with expenses in a successful manner.
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During the survival stage, your business is tested by determining, first, whether you are able to break even and, second, whether you are able to generate profits sufficient for reinvesting and growing the business.
Success
When a company survives the survival stage, it moves into the third stage, success. The challenge of a business owner with a successful company is deciding what they want to do with their success. Business owners basically have two options:
- Use the business as a platform for growth and continue reinvesting, expanding, and even using the business’s success and assets to finance and fund additional growth.
- Maintain the status quo, keep the company operational, and use the profits to fund other pursuits or interests.
Take-Off
As the business grows, getting bigger and bigger, each step up in revenue and profits also results in more rapidly expanding expenses. The challenges of the take-off or rapid growth stage primarily focus on managing rapidly increasing expenses, improving operations for greater efficiency, and identifying strategies for better management of personnel, task delegation, free cash flow, assets, resources, liabilities, and debt.
Rising to these challenges will ensure your business is able to support its rapid expansion and not grow too fast.
Resource Maturity
Although your company might still be considered small, small businesses that arrive at this final stage face the challenge of managing the resources they have and continuing to improve their companies through more strategic management of resources, people, and processes.
During this stage, business owners should focus on streamlining operations through budgeting and strategy while continuing to maintain their original entrepreneurial spirit that will help the owner to continue setting short-term and long-term goals so that the company avoids becoming stagnant.
