A lot of companies have found themselves sliding down the growth or success curve as a result of rapid acceleration without stamina. The growth process is a critical part of every company’s success and it is guided by strategies and policies. Companies that overlook this process sometimes bow to the pressures of competition and find out they are racing to nowhere – without a direction or goal.
It is important to shut out the noise around you and focus on growing your business internally, understand the process, conduct research and strategise on the best way to push forward instead of yielding to pressure or competition.
Pressurised growth has its downsides – sudden incurable case of diminishing returns. A slow growth might seem unattractive and unexciting but if it is geared towards sustainability, it pays off in the end. In the face of a rapidly changing market and stiff competition, many companies are prone to focusing all efforts towards expense-incurring activities in a bid to expand instead of focusing on improving and maximising what they have on ground. They fail to develop long-term strategies that are cost efficient so that they can thrive when there is a decline within the growth process that requires innovation or diversification in order to maintain its existence and profitability.
So, does physical expansion such as setting up more branches for a retail business truly indicate growth and guarantee success? Bear in mind that maintaining new outlets up to maturity stage takes time and money. Asides that, they are usually not fully patronised within the short term until aggressive publicity efforts are implemented. In other words, expenses are accruing.
This article examines some common pitfalls of growth and provides solutions on how and when companies should maintain ‘slow growth’ whilst increasing their operational revenue as well as strategies for maintaining their maturity level for a longer period without encountering an anti-climax or a decline. Also, case studies are provided with details showing that ‘over expansion’ can cause a quick decline to already successful companies because of the cost implications of setting up and maintaining additional outlets, taking uninformed steps and making random investments.
It also lists out other factors that can be responsible for reduced sales or decline in revenue such as natural disasters and others.