For many SMBs, the idea of growth elicits a mix of excitement and fear. A recent NetSuite commissioned research report by Frost & Sullivan found that more than half of all Australian SMBs expect to grow in the next 12 months, yet less than a quarter intend to expand their operations overseas and only 5 per cent have plans to launch new products or services.
In other words, growth is good—but only if it comes as a by-product of continuing business as usual, without the risks that come from innovation and expansion. So how can business owners grow while mitigating risks?
First of all, they need to understand the specific kinds of complexity, inconsistency and loss of control that growth can cause. Once businesses grasp this, owners can take steps to maintain the competitive edge of being small—often derived from extremely close relationships with customers and partners—even as they scale up their operations.
At this stage, SMBs will have succeeded in growing; but to make growth a sustainable process, they must translate their greater market share into even better products and services for their customers.
Doing so forges a virtuous cycle where growth, if properly paced and planned for, creates higher and broader satisfaction with the business—and, in turn, more growth.
Four tactics that can get any small business started on this virtuous cycle
1. Stay true to their core by Ensuring that the small business’ USPs (unique selling propositions)—like customer service, high quality and niche or personalised products and services—remain unchanged even as operations expand.
2. Build strong partnerships with retailers, resellers and other organisations that can lend their market share and reach to the small business.
3. Standardise and centralise operations, supply chain, and business administration to avoid dips in quality and productivity as a result of growth.
4. Use the data from increased market share and customer feedback to further enhance USPs.
A successful SMB will inevitably grow, with or without its owner’s intention. These businesses can establish a level of intimacy with their customers, and responsiveness to their needs, that larger businesses often struggle with.
This intimacy creates the demand that enables small businesses to grow—but often declines or disappears entirely once they reach a certain size. In order to grow successfully and sustainably, small businesses must maintain a “small business” level of service no matter the volume or variety of transactions they handle.
The examples in this blog show just how important it is for small businesses to design their processes to grow without compromising the quality of their USPs or customer service.
Partnerships, standardised and centralised processes, and greater use of data all help small businesses expand their reach efficiently while retaining control over how customers experience their brand.
The right technologies, particularly cloud and analytics platforms, play a major role in simplifying and informing growth strategies. But of greater importance is that SMB owners maintain their close relationships with customers—no matter how big they get.