Starting a business is much easier than actually growing your business into a success. Many entrepreneurs get off to an exciting start but soon realize that expanding their business into a money-making asset is a great challenge. Although sometimes there may be no explanation for business failure, usually there are indicators that can inform us of why a business is not performing well. Here we look at the top five reasons your business is not growing.
A surprising number of new business owners attempt to sell products and services that most consumers do not want. Often when this happens, the entrepreneur has a passion for the product or service but has not conducted the research to verify that there is a market for their business. No matter how much you love the products you sell, you must find enough consumers who also love those products before you should attempt to sell them.
After selecting a great product or service that people want, you have to put forth special effort to present that product to people. Many new business owners don’t market their business enough to get attention. They may show off their new business to their friends and family or set up a website, but it takes much more effort to get the kind of traffic to your offers that are required to grow your business.
Finding a product or service that is in demand is great, especially if you’re marketing your business, but it doesn’t matter if you are unable to get your products in front of the right customers. Your friends and family may love you and want to support your business but they are often not a good model of your ideal customers. If you’re marketing your business and not enough customers are responding, it may be an indication that you’re presenting your offers to the wrong consumers.
Not Enough Leads
It’s important to keep in mind that only a minority of the people who are informed about your business will make a purchase from you. This is normal. In some industries a 3% conversion rate is defined as success. That means only 3 out of every 100 people exposed to the business will make a purchase. Therefore in order to get 100 customers these companies will need to get their offer in front of around 3331 potential customers. Ask yourself when you’re marketing if you are reaching enough potential customers with your offer.
No matter how many people are exposed to your offers, if not enough of them are purchasing from you in order to grow your business, your business will likely remain stagnant. Conversion optimization refers to doing everything possible to tweak your offers and the presentation of your offers (i.e. ads, ad images, marketing copy, upsells, etc.) to give people a great reason to buy from you. If you can increase your conversion rate, you have a great chance of increasing the growth of your business.
If your business is earning one million dollars a month but your business has expenses that are nine-hundred-ninety-nine thousand dollars per month, your business is not profiting much and this might be a big reason your business is not growing. Find ways to cut back on expenses to increase your margins so your business can flourish.
Growing your business doesn’t have to be a mystery. In fact it should be predictable. Revisiting the areas in your business that are mentioned in this article will optimize your ability to grow your company in the short and long term. These principles for business growth and many more can be found in our Business Plan Strategies Ebook.