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Getting Stage 1 and 2 of Growing Your Small Business Right

Growing a small business is no easy feat. The complexities of scaling a business, more so a small business, can prove to be a daunting experience for any seasoned entrepreneur.

It gets even trickier when one attempts to categorize the problems that a small business faces during its infancy to its maturity. Small businesses are characterized by independence of action, organizational structures and nuanced differences, and different management styles.

With this blog post, we will address two typical stages that small businesses go through and how you can set up your small business so that you position your business for success.

Stage 1: Existence

In this stage of the organization's life cycle, the primary concern for the business is customer acquisition and the ability to fulfill customer orders or the timely and efficient execution of a service that the firm has been contracted to execute.

This stage of growth is typically hindered by working capital issues. Secondly, the owner of the business is more hands-on with the company at this stage. Staff is supervised directly by the owner, and it is the founder's responsibility to ensure that the team performs their assigned duties on time.

An apparent lack of organizational systems also characterizes this stage of the business. If there are systems in place, they are typically rudimentary and lack any notable sophistication.

Companies in the existence stage can be a small restaurant newly launched to a large manufacturing company that is yet to stabilize their production output and the quality of their production output, or an up and coming slot tracking tool. In this stage of growth, many companies never make it past this phase either by failure to meet production requirements or the lack of gaining enough customer buy-in.

To fortify your business and ensure that it makes it past this phase of growth, it is essential to ensure that the company has sufficient working capital, consistent brand awareness campaigns, and continuous improvement of organizational systems. Moreover, if the business is in the manufacturing space, Kaizen should be the company's mantra concerning product development.

Stage 2: Survival

By reaching this stage of business growth, the organization would have proved itself as a viable business entity. While stage one deals with customer acquisition and product development, this stage is concerned with the mutually inclusive relationship between revenue and expenses.

The organization is still superficial; however, there are other decision-makers involved. Secondly, systems development is much more robust than it would be in stage one, but it's still minimal. The primary goal is still survival, and the founder is still actively involved in the business's day-to-day operations.

To effectively break out from this stage, both the businesses' revenue and expenditure must be tracked with utmost diligence. Secondly, production planning and forecasting need to be your next actionable item. Most companies in this growth stage are typically restricted from growing further because of a lack of proper production planning and sales forecasting.


The first two stages of business growth are often the hardest to grow out of and require the owner to have proper working capital, a well-thought-out brand awareness campaign, a proper sales forecasting strategy, and a robust production plan.

7 Sep 2021