I occasionally run across business owners who questions the need to grow. Maybe it’s because they’re tired of the work or that the organization has become large and unwieldy, or maybe they’re making more than enough money and they just figure that it’s greedy to make even more.
Whatever the reason, they start making the case that a flat year isn’t such a bad thing. Wrong. A flat year is bad. Very bad. In fact, a flat year is a really a “down 10-20%” year. Here’s why.
The key resource in the vast majority of businesses is people. And people can’t stay flat. We need to grow. Early in life, that’s physically, but later in life that’s emotionally, intellectually, and socially. People are growing machines and when we stop growing, we start dying. Same is true for your business.
Here are a few reasons why your business needs to grow and what you can focus on to make sure your growth is positive and enriching for everyone. Including you as the business owner.
People Need Career Advancement
Everyone wants to move to the next rung. Beyond financially, people need to be challenged. And as they master their current work, they need a place to go that will give them greater challenges and new opportunities. A business who is not growing isn’t creating new opportunities for the people who work in it. Stop growing for too long and people will find their next challenges somewhere else.
Customers Need New Products and Services
Customer are hungry for things that are better, faster, and cheaper. While your latest and greatest version of your product might thrill the customer today, it might not tomorrow. Giving them the same old products and service will eventually shift from innovative to out-dated.
You Need to Keep Up With Competition
The fact is, everything else is growing. The economy, industrial markets, populations. Everything around your business is growing and increasing. If you stay flat, your share of the market will, in fact, shrink. It’s like inflation. While you might have a dollar in your hand, what that dollar can buy is getting smaller and smaller.
All of these point to the need to keep expanding and building the business. I tell my clients that 5-10% is the minimum they need to grow just to keep up. 15-20% is where you start to move the needle. And if you really want to put the peddle down, stretch to growth 25-50% a year. Growth is not just a vanity metric, it’s necessary for a business to keep its people and position in the market. Of course, it can make the owners more money too, but college tuitions are growing.