Growing a business is crucial to success but it takes more than wishful thinking. What’s required is a long-term strategy that targets business expansion.

These strategies will help you expand your business in South Africa.

What is a growth strategy?

A growth strategy is a plan or blueprint that addresses how a business must evolve to meet current and future challenges, and achieve its growth objectives.

Depending on the nature of the business and its inherent strengths, there are several ways to drive expansion.

Key business growth strategies

Here’s an overview of the strategies you can adopt to give your business a boost. They include the traditional four business growth strategies, along with some “extras”.

Market penetration

This entails intensifying sales in the existing market to gain customers from competitors and acquire a greater market share.

It’s a low-risk strategy based on increased promotional and marketing activity, competitive price adjustments, minor product improvements and enhanced distribution channels.

Market development

Market development focuses on introducing existing products and services to new markets.

It can involve finding unique applications for products, which organically opens up new opportunities. Alternatively, it can be geographic expansion into previously unexplored markets on a national or international scale.

As market development doesn’t involve developing and selling a new product, it carries minimal risk.

Diversification

This is achieved by introducing new products and services to unexplored markets. When implemented correctly, it can expand the reach of the business, increase sales and achieve greater profits.

As diversification involves developing and marketing new products to previously untapped markets, it carries comparatively high risk.

Product development

Product development is the launch of new products or services into prevailing markets. It’s the ideal growth strategy to adopt when existing products have become outdated.

Investment is typically required for the research and development of the product. It’s also needed to acquire the rights of a product or purchase and brand a product. The in-depth knowledge of the market offsets risk.

Outsourcing

The outsourcing of non-essential functions to third parties improves efficiencies and saves time and money.

Handing over systems and processes outside your area of expertise enables the focus to shift to core business competencies, thereby accelerating growth.

Strategic partnerships

Setting up strategic partnerships with complementary businesses can maximise resources, reduce workloads and facilitate access to diverse customers and markets.

It’s a viable growth strategy involving acquisitions, mergers or formal/informal business partnerships.

Planning business growth

A successful business expansion strategy is one that’s well planned. To achieve growth objectives, business owners must assess several factors and formulate a plan accordingly:

• current demand for products or services
• projected demand over the next five years
• growth required to meet projected demand
• impact of evolving competitor activity over the medium term
• additional staff requirements
• how expansion will affect cash flow and reduce costs.

General tips for expanding a business

In addition to implementing a purpose-designed expansion strategy, there are practical ways of growing a business. These aren’t focused enough to drive expansion strategically, but they may help your business grow sustainably and support your strategy for expansion.

Understanding customers, and providing the products or services they need, is the first step to growth.

Consistently engaging existing clients with promotions, discount deals, newsletters and emails – and providing an outstanding customer experience – builds a strong and loyal customer base that results in positive reviews and referrals.

Hosting charity events is an easy way of enhancing the brand image.

A strong social media presence is required to extend the reach of your promotional and marketing strategy.

Tips for staying in control as your business grows

Over-accelerated business growth can lead to dissatisfied customers, cash-flow issues and unhappy, overworked staff.

To enable a smooth transition, it’s vital to only take orders that can be fulfilled on time and within budget. Targets must be realistic and achievable. Costs should be properly tracked and accounted for.

Business resources, from machines and equipment to staff, should only be added if and when required. That way, you’re in control and capable of delivering the best products or services to market.

Getting funding to expand a business

There are a range of options, from bank loans to government funding. One option is short-term business financing, backed by high value assets.

Accredited finance provider Lamna specialises in providing secured business loans. Accessing the required funds is quick, easy and confidential.

The financial status of the business is inconsequential. Credit metrics aren’t used to identify and analyse risk levels.

Funding is commensurate with a percentage of the appraised value of the asset used to secure the loan, and available within 24 hours.

What we offer at Lamna

If you need a loan to help expand your business in South Africa, Lamna can help. We offer fast, discreet loans against the value of a wide range of assets, from commercial vehicles and property to personal assets, from luxury watches to artwork.

For more information about using an asset to secure a short-term loan, contact us on 086 111 2866 or simply complete and submit our online application form.