5 Important Stages For New Founders To Start A Business
Every business enters the business lifecycle when it is created. All businesses go through similar experiences as they progress through the stages. To better understand this process, here are 5 Important Stages For New Founders To Start A Business.
Seed And Development
The first stage is where all businesses start off as, an idea that you have before you commit to starting your business. This is the stage where you should determine the viability of your business and your own confidence in it before starting.
This can be done by doing research and obtaining advice from as many sources as possible, be it friends, family, industry specialists, or other business owners. With this information, you should consider your business based on the relevant factors that include, the state of the current market, your own business ability, and your financial situation.
After careful deliberation on the viability of your business idea, it is time to launch it. This stage of your business is where you start your business, with goods and services in production.
The start-up stage has the most risk associated with it, with many factors that can stop a business from growing. In this stage of your business, you will be constantly making changes based on unexpected criteria that were unaccounted for and your customer’s needs.
The ability to adapt is important in a business and it is even more so here, where being unable to adapt will mean the end of your business. Change is important, even if you feel like too many changes are being made to your original idea, know that what your customers want is what determines the success of your business.
Growth And Establishment
The next stage for a business is growth and establishment, where a business has already obtained a steady income and is attracting new customers. Cash flow should improve as responsibilities surface, with business owners needing to manage more in response to the business growth.
Effective management is needed to deal with the increasing workforce, cash flow, and competition. As your business grows larger, delegation is a necessary requirement as more important issues take your attention.
When you have stabilized through your growth, you will have found yourself with an established business. As you get used to your role as the head of an established business, you should take note of your competitors and make plans to expand if so desired.
This stage comes after you have established your business in the industry when you feel as if you could grow bigger and increase your reach. This is important as a business that grows complacent will soon find itself overtaken by its competitors.
When planning for your expansion, research into new markets is needed as moving into an unrelated area can be disastrous for your business. You should investigate businesses that can complement your own, along with your available resources, cost, effort, and the effects that an expansion can have on your current business.
Maturity And Possible Exit
After experiencing all the other stages that a business goes through, your business should have stable profits if you are doing well. Not all companies enjoy continued growth as some struggle to keep up, experiencing negative cash flow due to dropping sales and profits.
In this situation, businesses are forced to make a choice between further attempts at expansion or to exit the business. Choosing to exit can be an opportunity to cash out your hard work and effort throughout the years of you leading this business by selling it to interested parties.
On the other hand, it can also mean the loss of what you worked for as you shut it down for good due to declining profits being unsustainable. Either way, it means the end of your business as you have gone through all stages that a business can experience.