Posted by Denise Alison U nderstanding where you are in the business growth process is the first step to developing a plan to grow your business. Stage I: Start-Up During the Start-Up Phase every business grows. After all, you’re starting from zero. In this stage, the focus is on creating products/services, getting custom- ers, and proving the business has a chance to succeed. You will often works insane hours for little pay, but that doesn’t matter: coming to work is fun! Every achievement is celebrated. Many entrepreneurs will tell you that the start-up phase is the most enjoyable part of the business growth cycle. Stage 2: Survival The survival stage is the point when reality sets in. The business is up and running and sales are coming in. Formal planning is minimal and your actions all seem to be reactive, such as finding a way to make the next sale or dealing with unexpected expenses. Cash flow is tight and you are almost always working for less than a fair market wage. The major goal is survival. Many busi- nesses get stuck in this phase, believing that they key to success is finding a way to stick it out. Sadly, a willingness to work hard and live with stress is no assurance that your business will progress to the next stage. Most entrepre- neurs that find themselves stuck in survival mode for an extended period of time will eventually give up and close the business. Every new business must experience the survival stage, but successful entrepreneurs understand the importance of growing the business to the point where they can move on to stage three.
Stage 3: Viable Business This is the stage where you are gener- ating sufficient cash flow to cover the needs of your business and drawing a living wage. (Note that there is a dif- ference between a “living wage” and a “fair market wage”. A living wage is the amount of money you need to take out of the business to support a basic lifestyle). Many entrepreneurs choose to take less than a fair market wage, leaving money in the business to help them achieve something they care about. There is nothing wrong with this, as long as it is a conscious choice. Stage 3 is the time to reassess what you truly want from your business. Some entrepreneurs may be very happy with the business as it is, while others are far from satisfied and want to achieve more with their business. For the latter, continued growth is the priority.
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SPOTLIGHT ON BUSINESS MAGAZINE • MAY 2017
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SPOTLIGHT ON BUSINESS MAGAZINE • MAY 2017
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