Demystifying growth strategies - James Whittaker of Hazlewoods
The significant impact the pandemic has had on the economy over the last 18 months has created both challenges and opportunities for businesses.
While some businesses have been trying to maintain their position and are now looking to return to where they were pre-pandemic, others have diversified and grown - writes James Whittaker, director at Hazlewoods.
There are many exciting options to consider for development and long-term success but determining the best way to increase your market share requires a good understanding of the ways a business can grow and a strategic plan for implementing any changes.
The first important decision to make is whether you would prefer to grow your business organically or accelerate business growth through acquisition.
Organic growth is expansion achieved through increasing sales / profits via internal processes rather than a merger or the acquisition of a competitor. Typically, organic growth will take longer and require tenacity, hard work and vision, but is less risky.
Below are five factors that are important in achieving organic growth:
Make your customers your prime focus. By putting them at the forefront, understanding their needs and delivering a first-class service, you will achieve competitive advantage.
Any business is only as good as the people working in it. Investing in motivated individuals, who fit your company's culture and share its purpose and vision, will ensure you have people with the enthusiasm to help you drive the business forward.
The utilisation of recruitment may also be an objective to increase market penetration and offering.
We live in a digital age and harnessing the power of technology - particularly data analytics - will enable you to make quick, informed decisions as opportunities or challenges present themselves.
An overhaul of how your finance functions operate and careful management of your company's money may be required. You will need to decide on the best financial approach at every stage in order to derive maximum benefit and the utilisation of a clear business plan is essential.
You may also need to consider utilising external finance, either in the form of debt or equity to provide additional working capital to achieve these growth objectives.
Consider how you could adapt your core products or services to add value. Diversification can make your business more robust, more profitable and boost your brand image.
An alternative route for growth is to acquire either complimentary "bolt-on" or new service line "add-on" businesses. This may well require the need to secure external capital to finance such acquisitions. Making a successful acquisition can be hugely rewarding and beneficial to your business, but it is not without risk.
Below are five tips to ensure you make a successful acquisition:
Get expert help
Professional advisers have extensive market knowledge and will help you every step of way. They will help you get finance and if you do not have a target company to purchase, they will help you find a business that is a good strategic and cultural fit.
The acquisition process can be time consuming. Keep your eye on the ball and do not spread resources too thinly to the detriment of your existing business.
Have a maximum price in mind and be prepared to walk away. However, your adviser may be able to get the deal over the line by structuring the transaction in such a way that some of the money is dependent on company performance or some element of the payment is deferred.
Ensure that you undertake extensive commercial, financial and legal due diligence to investigate the financial performance and assess future risks, including obligations and liabilities, of the company you are buying.
Make sure you have a plan to integrate your new business into your existing company. Many acquisitions fail due to the difficulty of combining two businesses with different systems and cultures. Retention and motivation of key staff in acquired businesses is fundamental to achieving success.
For an informative and punchy insight into some of these keys areas of growth, James Whittaker, director at Hazlewoods, and Adam Kean, partner at BPE Solicitors, will be hosting a live webinar, 'Demystifying growth strategies' on Thursday 4 November 2021, 12.00pm-12.45pm.
The pair will be joined by industry experts, Phil Barton (chief executive officer, Partners&), Daniel Tapson (investor, BGF) and Jason Pearce, (non-executive director, Bamboo Technology), for an insightful discussion, sharing their experiences of organic and inorganic business growth.
Find out more and register here: bit.ly/demystifying-growth-strategies.
For more information about Hazlewoods and the services they can provide to your business, please visit https://www.hazlewoods.co.uk or call 01242 680000.
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