Businesses grow in relatively predictable ways. While your industry and business structure may vary, most businesses reach 7 milestones of growth along the way. Even if you haven’t technically started your business yet, if you’re considering it and are doing research, you’re already in the early stages of growth.
The 7 stages of business growth do not always happen in order, and you may find yourself going back and forth between steps. This fluctuation is a normal part of business growth. Below you’ll find details on the 7 stages of business growth to help you identify where you are on the scale – and how you can scale up to grow bigger!
The 7 Stages of Business Growth
The 7 stages of business growth are as follows: Dreaming, planning, doing, growing, fixing, shifting, and thriving. Not every business makes it to Stage 7 (Thriving). In fact, some businesses will make it past Stage 1 (Dreaming). Read about the 7 stages and find out where you currently are with your business, then devise a plan to get to the next stage of growth.
Stage 1: Dreaming
“I would love to start this general type of business.”
A dreamer isn’t the opposite of a doer – a dream is necessary before one can take action. When you’re thinking about starting a business and find out that you want to be an entrepreneur, you’re in Stage 1: Dreaming. If you take it a step further and begin actually planning to start a business, you’re on to Stage 2: Planning.
Stage 2: Planning
“I want to find out exactly how to start a specific type of business.”
You have a dream and now you’re ready to focus it a bit better and actually work on starting a business. In this stage of growth, you’re doing copious amounts of research into the viability of your idea, the current market, and similar ideas that are seeing success.
In this stage, you might find out that the business idea you had isn’t viable right now, and that’s okay. It’s better to find out in the planning stages than later on!
Stage 3: Doing
“I am armed with information and now I’m starting this specific type of business!”
If the planning stage serves you well and you find that your business idea is indeed a good one, congratulations – you’re now in Stage 3: Doing. This is the time for action, making calls, handling licensing and business registration, setting up initial strategies, calling in favors, finding your first clients, and connecting with those who may be able to help you along your way.
For many, this is the most exciting stage of doing business so far. But it gets even better!
Stage 4: Growing
“This business idea is working well, now I am working on growing it.”
You did it! You got your business idea off the ground and are now running a somewhat successful small company or sole proprietorship. Once you’re up and running without problems, your next order of business will be growing the company to serve a larger market, offer more services or products, increase your online presence, etc.
Growing your business is a trial-and-error process, and not one that will ever truly be finished. You’ll likely teeter between Growing and Stage 5: Fixing several times before moving on to Stage 6: Shifting.
Stage 5: Fixing
“Something went wrong when I started growing the business. Now I’m fixing it.”
When you first attempt to scale your business idea and make it run on a larger scale, you will inevitably run into unforeseen problems. This is normal, and in fact, it’s a stage of business growth called Fixing. This is the period of time when you will actively respond to problems to arose when you took action to grow your business.
For example, if you created a new eCommerce website for your brick-and-mortar store and customers complained that it wasn’t mobile-friendly, you’d be in the Fixing stage. This would entail making the website mobile-friendly and notifying your users that you’ve solved the issue.
Stage 6: Shifting
“I’ve learned new things about my audience/business/market. I’m shifting to better position the company.”
Sticking with the example from Stage 5, if your new mobile-friendly website did so well and was so cost-effective that your in-house sales paled in comparison, you might start thinking about investing more in your eCommerce website and begin to move away from your brick-and-mortar location – entering Stage 6 of business growth, or Shifting.
When you are in the shifting phase, you’re more experienced and have a more keen analytic eye to view your company through. You will have more wisdom and a better grasp on the big picture, so odds are, you’ll realize you need to change something fundamental about your business. It’s just par for course for companies that go on to thrive!
Stage 7: Thriving
“My business is growing at a steady rate and is thriving.”
Stage 7: Thriving is a special time for a business that manages to reach it. When a company is thriving, it’s growth is somewhat self-sustaining and happens at a steady, mostly predictable rate. Once an actor has reached celebrity status, they no longer need to take roles they don’t want or aren’t interested in. They have the freedom to focus on what they do best and what they enjoy – similar to the freedom afforded to business owners when they reach the Thriving stage of business growth.
At this point, your company is certain of the course it is on, the audience it serves, and how to connect and interact with that audience. All you have to do is ensure you can continue to scale the business successfully and keep your growing numbers of customers satisfied! As you can see, the business of growth is never really finished until you close the business down.
It’s possible for thriving businesses to regress back to earlier growth stages if the new growth can’t be sustained or managed properly, so ensure you don’t let go of the reigns when your company starts to experience steady growth.