The simplest sales growth to achieve in a business is to expand what already exists. But it may also be the weakest form of sales growth with the least endurance and lowest capital value. Nothing worthwhile is achieved easily, and that certainly applies to sustainable business growth. Shifting the focus of sales growth from expansion to creation requires a sustained effort until it becomes a core of your business, and then your growth becomes extraordinary.
Active Knowledge Question:
If you look to where you are presently seeking sales growth, is it simply more of the same?
Quick and Easy
If you are driving your team to achieve a monthly, quarterly or annual sales target, quick and easy will be the chosen path. At the end of the day, it’s only a figure which gets reset, and then you start all over again. This is often the path chosen, but it doesn’t get any easier to achieve those sales targets as the years progress.
The short-term focus of the quick and easy should be a growth strategy that you are always seeking to step away from. Strategically, you want to anchor your growth strategy in catalysts that build a foundation that will secure your market and deliver ever-increasing sales to your door.
Quick and easy also tends to drive down margins in securing sales before cut-off dates, builds price as a differentiator, creates division across your sales team as they individually chase targets and does little to strengthen brand equity.
Sustainable growth arises where you continuously build upon what has gone before, failures and successes, growing along a clear path. A path that is purposefully designed to result in the creation and delivery of greater customer value.
When developing growth strategies, customer value must always be at the core of your efforts and focus. Customer value is what businesses compete around, with the goal being to deliver a customer value that no one else can outcompete. And that does not happen overnight, but when it begins to materialise and is compounded on, it becomes unstoppable.
Customer value lies in the benefit that the customer gains from using your product or service against that of a competitor. It’s the degree to which it fulfils the customer’s need that determines its value. There are many elements that will comprise value, and these turn around the nature of the need; basic food products, luxury cars, holiday destinations, clothing – all have a very different needs matrix.
When developing a growth strategy, your journey should be one of creating distance from your competitors so that the value you deliver is quite different from those of your competitors. And not different in the normal sense of the word, but rather offering so much more value to the customer than anyone else can.
And the ability to craft that ‘different value’ can only come from your unique knowledge and insight into the real needs of the customer market you have chosen.
The journey of gaining knowledge and insight represents the creation of the catalysts of capital value. Capital value lies in the certainty of enduring income. The greater the certainty, the greater the value. The more entrenched the culture, processes and leadership of knowing your customers’ needs for today, and importantly tomorrow, the greater the certainty and the greater the capital value.
Expansion To Creation
There is a journey in building a growth strategy that transverses the range of expansion to creation, with monitoring being the connector.
Your growth strategy will see ‘expansion’ as the daily sales activity, ‘monitoring’ as looking for new openings and ‘creation’ as creating value where no one else does:
– Expansion comprises growing your existing sales through activities such as:
- More revenue from existing customers
- Gaining more customers
- Increasing margins, upselling
- Expanding existing services/products
- Adding in supplementary services/products
- Expanding geographically
– Monitoring involves increasing your customer focus and noting what is happening in their world and understanding what impact it may have on the value you are able to offer into their needs. Monitoring is about placing client needs at the centre of your focus and building a deep understanding of how change might impact them, their needs and the value you deliver. It’s searching for opportunities to increase customer value, moving away from competitors and closer to your customers.
– Creation comprises imagination, exploration and discovery. It’s about understanding your customers and their needs even more than they do, but importantly also drawing in the changes that you are detecting through your monitoring activities. In creation, you are exploring what might be possible and where you may be able to create a new level of value for your customers. A value that your competitors have not even recognised, and which will create a new market for you.
Your growth strategy should never just be about what is needed to reach a short-term target. It must lean into creating a business that can discover continuing opportunities to deliver increasing customer value that will renew and draw in continual and compounding growth as you step away from your competitors. This is where your growth strategy feeds the growth in capital value.
An entirely new level of performance.
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All the best in the success of your business,