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Business growth strategies

Simple Alliance, Kenya Limited


Business growth strategies for profitable business development

Once you have started a new business there always comes a challenge on how to ensure business growth. In handling this there are basic rules that will guide you as you prepare for business development.

Establish a stable platform

Establishing a stable platform on which your business stands as you go about the growth process should be the first growth strategy that you employ. This would be achieved by removing any hurdles that your business might have been facing in initial operation and would include making it profitable.

Have experience in all business aspects

Experience in all the aspects of your new business is a key determinant on your readiness to expand and works to improve on it. Whichever business you start, is it a cyber café or a fast food restaurant it is important that you become personally involved in all functions of your business as a business owner. Through this you are able to detect the weaknesses that can be worked on with immediacy and early enough and changes that can be made which will expose you less to loss

Being personally involved in every aspect of your business has a long term advantage in the case of expansion which is an aspect of business growth. As you will be depending on other managers to whom you will delegate responsibilities. With experience and knowledge of your business operations no one can fool you on how to run the business.

Identify and adopt effective employee theft management systems

Expansion requires you to put in place systems that prevent employee theft and shrinkage commonly referred to as shoplifting. This is because with expansion you may not be the one in charge of the cash register. Remember that after your expand, you will no longer be the person at the cash register. Loss prevention systems could be industry specific in terms of their effectiveness and it would be wise if you monitored what your competitors have been using because they probably could have figured this out. For example if you intend to start a fast food restaurant you may want to know how Java Coffee House has been doing this.

Separate business liabilities from personal assets

Separate your business liabilities from personal assets and avoid giving personal guarantee on leases or creditor obligations. Achieve this by drawing the line against the practice of exposing personal assets even when a lending institution requires your personal guarantee on business loans.

 

For example, a potential landlord for your second store may ask you to personally guarantee the lease. Your exposure in a five-year lease of KES3,000 per month would be KES180,000. This amount could far exceed the initial capitalization of your business. Yet because of the desire and enthusiasm to add more stores, it will be tempting to incur such potentially overwhelming liabilities.

Instead, by practicing discipline in limiting your liability, you might insist on negotiating a one-year lease with options for additional periods of time. Your liability in this case would be reduced to KES36,000.

Every business owner dreams of business growth and would like to see their business grow, this however comes with challenges and an entrepreneur needs to take care of this right from the onset of their business strategy. It is important to establish a stable platform on which your business will develop by eliminating any cuts on your profits. Being experienced in all aspects of your business by being directly involved helps you avoid any losses that may arise due to employee theft after expansion and in doing so you must ensure that you clearly separate your business liabilities from personal assets

Copyright (C) 2016, Simple Alliance Kenya Limited

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