Business Cycle: What Should You Focus On At Each Stage Of Your Business
Business is always changing. Your company will go through various stages of the business lifecycle. What you focus on today will change and require different approaches to be successful.
STAGE 1 – SEED AND DEVELOPMENT
The beginning of the business idea. Get advice from as many sources as possible. Review profitability, the market, competitors and the business structure. A good business plan is vital for success.
STAGE 2 – START UP
Make your business a legal entity. Adjust to your customers’ needs and wants. Establish a customer base and concentrate on marketing and profitability. Reviewing the business plan, budgets and cashflows is vital.
STAGE 3 – GROWTH AND ESTABLISHMENT
Fine tune your business model, sales model, marketing model and operations model. While managing a good team concentrate on sales and marketing. Consider the need for external consulting advice on the business development.
STAGE 4 – EXPANSION
The business has a steady income and flow of customers and the business feels like routine. If deciding to expand your offerings or move into a new market, you must consider the risks; competition, resources required, time required, the effects on current customers and the financing.
STAGE 5 – MATURITY AND/OR EXIT
Your business could still be growing and the current option is to decide to take a step back towards the expansion stage or to think of a possible exit strategy. Is the business financially able to cover an unsuccessful attempt at expansion? Have you planned your exit strategy?
Not all businesses experience every stage of the lifecycle and some experience them in a different order. Every stage of the business lifecycle brings new or re-occurring challenges. Solutions that may have worked for one stage may not work in another stage, which is why you should always adjust and review your business plan and operations.