How does a small business grow into a medium-sized business?
If you’re a small business owner thinking about growing your operation, you’re in the right place. It’s the title of the article, but let’s ask the question at hand with added context: How does a small business grow beyond 1-20 employees? How does it grow its revenue into the millions?
When the last U.S. census was conducted, businesses with fewer than 20 employees made up 89% of the economy. That size – a business with 1-20 employees – is often used as the reference point when defining small businesses. The other reference point to consider is the amount of revenue generated. According to Gartner, the revenue difference in small to medium-sized businesses (SMBs) is explained with these figures:
The second most popular attribute used to define the SMB market is annual revenue: small business is usually defined as organizations with less than $50 million in annual revenue; midsize enterprise is defined as organizations that make more than $50 million, but less than $1 billion in annual revenue.
With those numbers in mind, here’s a multiple-choice question: What does it take for a small business to make the leap to the next tier?
A) Growing its customer base
B) Generating more leads
C) Booking more jobs/selling more products
D) Diversifying product offerings
E) Expanding into new regions
F) Increasing customer satisfaction
G) Supercharging its marketing plan
H) Building and maintaining a strong reputation
I) All of the above
Hint: If there’s an “all of the above” answer, that’s usually a safe bet. Since that’s the case here, let’s break down how growing bigger than a small business will involve some serious planning, execution and goal setting.
The first question to ask
How do you want to grow?
Be specific by using your data to establish your targets. If you’re looking to grow your revenue, examine your current numbers to determine what’s achievable in one, five, ten years. If you’re looking to expand into a new area, make the case for it. Is there a reliable market share to go after? Do you have the team and the capital to meet the needs of a new region? The more specific you can be, the more you can measure your success in getting there.
Putting a plan together
After determining how you want to grow, you’ll need to hammer out what, exactly, will help you grow. As covered in the multiple-choice question above, it’s going to involve a coordinated effort on many fronts. You and your team will need to buy into the plan and delegate who will steer each strategy toward your goals.
Don’t shy away from the get-specific zone when looking at the strategies below. With each one, we’re asking and answering how you’ll get it done. And one more thing: Look for the blue checkmarks in the sections below. These are areas where BBB can help drive your success.
Business growth goals and how to accomplish them
1. How do you expand your customer base?
How this grows your business: More customers mean more business. Growth happens when you’re consistently looking for ways to reach new audiences and convert new leads. Here’s how to do it:
- ☑️ By optimizing your quote program: If your business offers service quotes, get really good – and fast – at giving them. Quotes come from ready-to-buy customers, so make the choice easy for them.
- ☑️ By acquiring new customers: Lead-gen campaigns and referral programs are a start but stay on the lookout for initiatives to reach new audiences. Set goals for the number of new customers you aim to acquire each month.
- By diversifying your offerings: Add complementary services that fit well with your existing offerings. For customers, these can be seen as perks that encourage new and repeat business.
- By offering seasonal services: When you operate year-round, it fuels growth. Offer seasonal promotions or services to keep business steady every month.
- By expanding into new regions: It goes without saying that sometimes you’ll have to meet customers where they are to grow your leads. When you’re thinking of new locations for your brand, make sure to identify and target areas that make financial and logistical sense for your brand.
2. How do you leverage customer reviews and referrals?
How this grows your business: Reviews are the social proof that says you’re a business to trust. When others vouch for you, this leads to more customers wanting to buy from you. Here’s how to do it:
- ☑️ By encouraging reviews: Ask satisfied customers to leave reviews on reputable review platforms (like BBB).
- ☑️ By aiming for high customer feedback scores: The most stars is always the goal, so focus on delivering customer experiences that result in customer satisfaction scores in the 4.5-5-star range.
- By introducing referral programs: Create a referral program that rewards customers for bringing in new business.
3. How do you build a strong online reputation?
How this grows your business: With 95% of consumers doing their research online, your reputation needs to be monitored, managed and enhanced to reach every last customer interested in your services. Here’s how to do it:
- By running a strong website: Confidence in a business is higher when they can easily find and access detailed information about your services, pricing and contact details. A professional, user-friendly website is a must-have for today’s customers.
- By maintaining a strong social media presence: Find the platform that’s right for your business, then use it to engage with those audiences as you build trust in your brand and showcase your offerings.
- ☑️ By investing in SEO: Having an SEO plan will help you rank higher in search results for keywords related to your products.
4. How do you activate cutting-edge marketing and advertising campaigns?
How this grows your business: If you want to grow your business, customers need to know about you. They need to recognize your brand’s name, your logo, your offerings, how your products solve a problem, your specials, and most importantly: your differentiators. Having a marketing plan in place is how you’ll communicate all of the above to drive growth. Here’s how to do it:
- ☑️ By launching digital marketing campaigns: Use Google Ads, email marketing or other online ads to reach prospective online customers.
- ☑️ By focusing on local advertising: From transit ads to digital display ads to billboards, local advertising can boost your presence and relevance to your community.
- ☑️ By leaning into content marketing: Blogs or videos can be used to illustrate how you’re a reliable, ethical expert in your field.
5. How do you double down on learning (both you AND your team)?
How this grows your business: A growth mindset often results in a willingness to adapt and evolve over time. Learning about new entrepreneurial strategies, skills, technologies, training methods and products keeps you and your team current in your industry. As you set your sights on growth, this positions you to innovate and make the best decisions possible. Here’s how to do it:
- ☑️By attending webinars: These learning opportunities are abundantly available so stay tuned to the relevant outlets and platforms to enroll in webinars when possible (register for BBB’s Behind the Sign series here).
- By educating your employees: Encourage employee growth by looking into new learning opportunities and enhanced skill certifications for your industry.
- By meeting training requirements: Help employees as needed to ensure they obtain the required training, licenses and certifications for your industry.
- ☑️By subscribing to newsletters and industry blogs: These subscriptions can help you stay on top of current industry trends to help you stay competitive. If you haven’t already, subscribe to BBB SmartBusiness here.
- ☑️ By seeking out feedback: Building on the customer review tips above, implement a plan to gather, learn from, and act on feedback.
6. How do you keep building new partnerships?
How this grows your business: Partners are allies. Whether it’s growing your customer base, sharing resources, improving supply chain efficiency, or just having a brand advocate in your corner – your network is one of the most valuable assets to lean on when growing your business. Here’s how to do it:
- ☑️ By networking: Stay active in your community by attending trade shows, joining local business groups or chambers of commerce, and register for industry events. Also, keep your eyes peeled for any events attended by BBB – we want to promote our Accredited Businesses!
- By participating in online forums: Stay tuned to your online news outlets and platforms as these could also provide networking opportunities.
- ☑️ By forming strategic partnerships: The Accredited Business community is a great place to start as you look to form partnerships with others to cross-promote services.
7. How do you boost your operational efficiency?
How this grows your business: Growth is easier when you can meet the demand. Aligning your operational goals with the right tools, tech and know-how will help you rise to the challenge. Here’s how to do it:
- By investing in technology and equipment: Keep up with the latest tools and technology to improve efficiency and service quality.
- By creating project timelines: Completing projects within a specific timeframe will help you meet monthly and yearly project timelines.
- By reducing costs: Identify areas to reduce operational costs without compromising quality.
- By having up-to-date software: Evaluate the software you’re using to ensure you’re using the best solution for accounting, scheduling, invoicing and customer relationship management (CRM).
8. How do you increase your revenue?
How this grows your business: Falling under the growth definition mentioned at the top of this article, your revenue could propel your business into a new tier. The “$50-million” number might be lofty, but the same tactics below apply for any business owner wanting to increase sales. Here’s how to do it:
- By setting monthly/quarterly targets: If you want sales to go up, set specific revenue targets to work toward each month or quarter.
- By developing a solid budget: Maintain a detailed budget to manage cash flow and plan for future investments.
- By pricing strategically: Regularly review and adjust your pricing to stay competitive and profitable.
- By upselling services: Upselling additional services and products is another method to employ but be sure to do this ethically to preserve your trust with customers.
How BBB helps you grow
Growth takes time, people and partners. As an organization that prioritizes the success of small businesses, BBB is an ace in your pocket when it comes to growth. As indicated by the blue checkmarks, BBB has a solution for the bulk of the strategies mentioned in this article: Get-A-Quote, BBB SmartBusiness, BBB Learning, BBB Profiles, BBB Marketing Solutions, to name a few.
Not every small business is BBB Accredited, but for those that are, BBB is an asset. The resources we offer are designed to grow your business with the care it deserves. Because Accredited Businesses are committed to driving trust in our communities, we want customers to know about them. Yes, the growth of your business is part of it. Yes, your revenue is part of it. But what’s also part of it: the continued success of all our Accredited Businesses. It’s why we do what we do.
If you’re looking to grow your business and want to know more about how BBB can help, let’s have that conversation: