The Truth About Business Growth and the Various Metric to Measure Business Growth

Shalom Solomon 19th August, 2021

Why did you start your business? What are your goals, your aims and objectives? At one point or the other as a business owner, you will be faced with these questions. Wise business owners would have established the answers to these vital questions before even starting out their business.

Business aims and objectives vary greatly based on the need or problem being met or solved, the amount of startup capital, the entrepreneur, the type of business and the target market of the business. But, one vision or goal that every business I have come across (and maybe those I havenâ€™t come across) have in common is growth.

Every organization, company or business venture aims at growth and development. No one wants to run a business that would just be surviving, a business should show significant improvement over time. Growth is shown either in the size of your workforce, the revenue it generates, the look of your work environment, the wages of your employees, etc. Some businesses set short or long term goals to motivate and direct their efforts, for instance a fish farm might set a target to double the number of fish ponds in a yearâ€™s time.

One thing about business growth that is a proven constant is the fact that businesses do not just grow spontaneously, except rare cases (lucky bastards).

Business growth most often is as a result of well thought out, planned and implemented strategies. Every decision you take as a business owner should be strategic and backed by logic.

This is why it is always advised, in fact, it is strongly recommended that a business owner carries out intensive research before decision making. The level and depth of the research will be dependent on the degree or magnitude of the decision being made.

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What is Growth in Business?

Growth as a word means development from a simpler to a more complex stage. In business growth occurs when a business or company is ready to expand and is searches for a way to increase its productivity. Expansion for businesses is always a good thing. As weâ€™ve established initially, a business can grow in any direction or way. That means there is no one single quantity that is used to measure business growth.

Business growth can be shown in the following ways:

a. Increase in revenue

b. Increase in number of employees

c. Development of the businessâ€™ physical structure.

d. Increase in the wages of employees.

e. Improvement in sales.

f. Increased customer base.

g. Added services or products.

h. New branches, etc.

i. Increased market share

There are so many other ways a business can grow. The tricky thing though is that, some businesses can grow in some of these ways and not others. For example, a startup company might gain more customers and increased sales in the first quarter of the year without increasing its workforce or relocating to a bigger office. Does this mean that the business has not grown?

Of course not. The business has definitely grown.

Finally...

Therefore, the fact that your business did not increase in one area does not mean it isnâ€™t growing. It might be stagnant on one area but soaring in another. It is up to you now to determine where your business isnâ€™t growing and map out strategies to instigate growth in that aspect. In the long run though, a business can grow in all the ways mentioned above.

Thanks for reading : -)