Posted in Finance Articles, Total Reads: 2223
, Published on 24 July 2014
"The business of business is to do business"
The basic motto for any business is to flourish and have a well renowned name in the industry along with making substantial profits after all the investments and operations. Its takes a long time for a brand name to get established in the minds of the people through a lot of marketing, brand building exercises, customer focus, good word of mouth etc. It is hence utmost important that a business lays down a strong foundation and a stable base in terms of operations, customer reach, channels and financial stability.
Once a business is stable and ready for increased performance, there are many ways in a business can be propelled to newer heights. Some of the ways in which businesses can gain more momentum are given below:
One way in which businesses can excel is to scale up or multiply the current business model. Its a simple case of expanding the business by increasing the business by sheer volume using the existing business channels.
Consider a newly started FMCG business by a small firm. The business has its distributors in 5 cities which gives the business an access to 50 retail outlets. This business since its inception gets stable revenue and has a decent customer response as well. If this business is now scaled up, it means reaching out to 50 cities instead of 5, thereby increasing the retailer presence and hence more customers. A significant increase in the volume sale would propel the profits considerably and would help the organisation gain momentum simply by scaling up the existing business model.
2. Diversify into similar products or services-
Once a business successfully establishes a sound platform and a consistently performing financial model, a company can look into bringing in new products and services similar to the current portfolio. In this case a business simply has to add more products and services which probably can impact the potential customers in a similar way and induce a purchase.
Consider a brand which is prevalent on the online platform and earning revenue through online advertising. This company can set up a similar website or increase the content and sections on its existing website to attract more online customers. The more the content, the more would be the traffic on the website, which would directly help in revenue enhancement.
3. Find alternate revenue channels-
It is possible that a business has saturated its existing channel for its revenue. With the business expanding in volume, the company didn't find alternate channels for revenue generation. However, for every business it is possible to increase its revenues through multiple channels.
For example consider a retail store which has been doing very well as the number of customers is increasing which is yielding good business for the company. However, with a certain amount of saturation in the channel where customers have to come to the store to do their purchases, the business can find alternate revenue channels. If the business decides to form an e-commerce website, it can open up a completely new channel by attracting the online users to buy through their online store. Hence, finding an alternate channel would directly impact the revenue growh positively.
4. Increased marketing and brand visibility-
Often it happens that when a company enters a business, very few people are aware of the products and services which are offered. Even is a company is having a very different USP, unless people know about it he business would not flourish beyond a certain point. Hence companies have to focus on media coverage, interviews with newspapers etc which helps in brands having a sound credibility. Also, advertising through print media, TVCs, online media, social media etc would help increase brand reach thereby increasing a potential sale.
Businesses in the market always reach a stage where their profits, customer base etc gets stagnated. Hence, businesses have to find out alternate ways of giving a momentum to their business so that they can grow in leaps and bounces, as for every business only sky is the limit!
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