Squeeze Your Way To Business Growth

If you want to grow your small business, it’s time to squeeze some oranges.

No, I don’t mean you have to go out and start drinking orange juice. I mean you have to squeeze more out of the things you already do and have in your business now — your products, services, customers, distribution, even employees. You’ve got to make from what you already have, especially in this economy.

I think it helps to think of your company’s various assets as baskets of oranges. For instance, if you’ve been in business for some time, you’ve already developed a number of very valuable assets. You’ve spent money, time, energy, and careful thought developing a number of key ingredients for your success, such as your existing:

• Products or services;

• Clients or customers;

• Marketing materials and methods;

• Distribution channels;

• Key referral sources.

Let’s call that your first basket of oranges. You’re already getting a certain amount of money — juice — from that basket.

Now what’s the best way to make more money?

Create a second basket of oranges? Or squeeze harder on the oranges you have?

Instinctively, many entrepreneurs wanting to grow their businesses take the route of creating a second basket of oranges; they develop new products, services, or markets. It’s particularly tempting to try to find a new basket of oranges in this economy. But that costs a lot.

Are you really sure there’s no more juice in the basket of oranges you already have?

Let’s examine a number of options for growing a business:

1. New product development: You create and offer additional products or services. This means investment — research and development, finding new sources, adding production capacity, testing and perfecting.

2. New market development: You offer the same products or services, but now you look for totally new markets. This means investment — opening new locations, developing new distribution channels, creating new marketing materials or Web sites aimed at these new markets.

3. Opportunistic: You respond to opportunities for new business as they come to you. If it’s a big enough customer, they may demand that you change or significantly modify your products or services. Also an investment.

4. Increase sales to existing market: You go after the same or similar market with existing products or services, but you market more aggressively. You might have to tweak, revise, or reprice some of your existing products or services, but you don’t totally revamp them. Instead, you work harder, longer, smarter.

The first two options require you to invest a lot of time, money, and energy in cultivating what is, essentially, a new business. That costs a lot and takes a long time to see results.

The third growth option is by responding to opportunities that come to you. Most entrepreneurs grow at least part of their business this way.

In fact, I first went in to business by literally bumping into an opportunity. While walking my dog, I met a man who needed a business plan; I had never written one before. Twenty years later, I’m still dealing with business plans and business planning.

But growing opportunistically is hit or miss. You can’t control or count on it.

The final option is to find ways to sell more of your existing products or services to your current customers through your existing sales channels. This is the most lucrative. You don’t have to invest a lot of time and money in developing new products or new distribution or marketing techniques.

You’re squeezing your oranges!

So — if you want to grow your business, you’ll probably find it doesn’t make a lot of sense to create entirely new product lines unless your product is out-of-date or no longer competitive. And it doesn’t make sense to develop new markets unless your current market is extremely small or shrinking.

Instead, the best way to grow your business and increase sales may be to build on what you already have in place.

Rhonda Abrams is the author of “Six-Week Start-Up” and “What Business Should I Start?”