According to Forbes, every business—no matter how big or how small—goes through the same business life cycle. The life cycle consists of a spectrum of four stages that your business will move through, and knowing where your business is in the cycle is critical to your long-term success. We want to focus on one stage in particular, maturity, because this can be a make-or-break stage in business development.
Business Life Cycle
The business life cycle has four primary stages of development. Knowing which phase your business is in can help guide the strategic planning and operations decisions you make and, ultimately, keep your business moving forward.
- Startup—This is possibly the most exciting time in your business! You’re engaging with folks about your new venture, you’re brainstorming, and you’re trying out new ideas to test the waters of growth. As exhilarating as this stage is, it is also where most businesses fail. It’s important in this stage to develop a business model that allows for consistent growth, increasing cash flow, and the ability to hire a team to help with the process.
- Growth—The most self-explanatory of the phases, this is a time of gain. People know about your business, revenue is increasing, and you’ve worked out the kinks that come along with getting your business off the ground. Rapid growth is exciting, but also needs to be managed closely with goal setting and realistic planning for the future.
- Maturity—Once your business reaches the maturity stage, this is where you find a strong sense of stability. After a number of years growing your business, you now have brand recognition and are consistently profitable. The personnel hiccups have been worked out and you have a strong team of employees helping you, with little turnover; this is also the time when most business owners can finally take a more regular salary for themselves!
- Renewal/Decline—Because the maturity phase is so comfortable, many business owners don’t even know when they’ve entered a decline. This is because your top customers and clients are still around and, likely, using more of your products and services. How does this cause a decline? Well, it can cause you to lose sight of the need to continue to innovate and advance your business.
Strategies for Navigating the Maturity Phase
If you think your business might be in the maturity stage, and you’re not sure what to do next, consider the following strategies to help keep your business going strong.
1. Expand your customer base.
2. Increase your rates.
3. Invest in good R&D.
4. Modify your products & services.
5. Price your products & services competitively.
These are just a few of the options you might consider if you are worried that you’ve reached a plateau in your sales or customer growth. The key to incorporating any of these strategies is to revisit your business plan to determine how implementing any, or all, of these might impact your long-term goals.
Work with Growth Capital
Figuring out your next steps to take your business from the maturity into the stability phase might seem confusing. You’ve spent all of your time bringing your dream to life and helping it grow, and now you need to plan for its longevity. That’s where we come in! Our team of economic development finance professionals has years of experience across many industries working with businesses in all stages of the life cycle. Let us help you figure out your best, next step to keep your business thriving and not just surviving!