Ways to Grow Your Business
New Delhi, Feb 17 (KNN) Growing a business is not easy, but, it is what every business owner aspires. The success of one’s business depends on the efforts to grow profits using various methods. From employee training to marketing, every aspect of a business needs attention. Scores of internal as well as external factors need to be considered before deciding on the nature of the growth - lateral or vertical.
Rapid growth does not happen suddenly, but there are numerous steps one must take to keep their business moving forward. It takes time and determination. But, when one starts reaping the benefits, they will see that the effort is worth it.
Here are some tips to consider if one wishes to see their business grow:
1. Adding new and innovative products and services: Introducing new and innovative products and services by expanding the current lines or contending in a new segment can help business owners to grow their business and increase portfolio and sales. The resolution to bring in new product combinations to the portfolio needs to be done through exhaustive financial scrutiny. It is also imperative to understand and assess the potential demand for the product and service about to be introduced through the breakdown of current trends and market research.
2. Expanding into newer markets/customer segments: Expanding into a new market is an effective way of leveraging the core business for growth. Entry into new locations will require a significant investment of both time and money, so one needs to perform a thorough market research first to ensure there is enough customer demand in the new territory.
3. Research the competition: When going to market, it is crucial to research the competition. It becomes important to analyze new opportunities in the business by understanding the competition better. There are possible dozens of new opportunities one could follow instantly with the proper amount of competition analysis. This allows one to uncover opportunities and foray in the market better.
4. Launching new sales and distribution channels: Many companies find that one of the best ways to develop is by introducing a new sales channel. Today, in addition to retailers, distributors and direct sales, an e-commerce platform helps massively in increasing reach. Business should tap all these channels for a better expansion.
5. Acquiring another business: Buying another business can be a productive way to enter a new market, upturn market share or expand. While it can help a business size-up considerably, it has to endure a rigorous process of due diligence. The business owner must bear in mind the target company’s financial wellbeing, the value and the competences of the management, the size of the company’s consumer-base and the sustainability of existing contracts.
6. Franchising the business: Franchising is one of the best growth strategies, particularly, if the business model is lucrative and can be simulated easily. However, the business owner has to go through a rigorous process of checks and balances before zeroing in on a franchise partner. Also, the business owner should have a clear legal agreement, handpick locations prudently, and be eager to support the franchise money-wise and with knowledge input during the initial months.
The Next Step: Amassing capital for expansion
Now that one has decided the strategy for expansion, the next obvious big step is to amass capital. Needless to say, nobody carries that kind of cash in their pockets. So, either they need to approach a bank or an NBFC for a loan. In addition to this, factors like what type of loan to apply for and what documents to use need to be considered as well.
When it comes to applying for a loan, business owners need to organize the loan application which includes KYC documents, latest ITR, copy of PAN card of the business, entity proof, address proof of the business, last three years of audited financials, current year’s performance and projection and most essentially, proof of the business’ creditworthiness.
This is where CIBIL Rank and Company Credit Report (CCR) comes in handy.
CIBIL Rank and CCR is an indicator of the business’ credit worthiness. The CCR is a record of a business’ credit history, created on the data submitted to CIBIL by the financial institutions. CIBIL Rank is a precis of the CCR in one number, which is calculated on a scale of 10 to 1 – 1 being the best rank. The CIBIL Rank and CCR help banks and NBFCs evaluate the business and make an unprejudiced and neutral decision. They may even approve the loans quicker and extend lower interest rates based on the CIBIL Rank and CCR.
So, business owners should understand the importance of the CIBIL Rank and CCR which can help the lenders assess the business and guarantee a smooth loan application process. Business owners, looking to grow their business, can apply for a loan with certainty with a high CIBIL Rank and CCR and productively instrument their business development plans.
To know more, log on to https://www.cibil.com/company-credit-report
DISCLAIMER: This story has not been edited by KNN India staff. The view and opinion expressed in the article are of the Aanchal Kurmi.