business owners coming together to discuss strategy

10 business growth strategies: sustainable ways to grow your small business

Reading time: 8 minutes

Business growth strategies are how you avoid leaving your success up to chance. With a clearly defined plan, you make innovation proactive, consistent and sustainable. Without one, you risk leaving your small business at the whim of sudden market changes.

But a business growth plan is not a failsafe get-rich-quick scheme; it’s much more than that. It’s how you make business success an ever-present goal. And it keeps all employees in that same mindset, ensuring that everyone — from ground-floor workers to business owners — is contributing to a unified strategy. To get you started on your journey, we’re going to explain what a growth strategy is and how to develop one for your business.

Table of contents

What is a business growth strategy?

A business growth strategy is a well-defined framework that provides clear, actionable steps for achieving increased success. What “growth” means is ultimately up to the business, but most business growth falls into one of two categories:

  • Internal: Growth that depends on factors within the business, such as developing new products, marketing campaigns or increased efficiency processes. This is sometimes called organic growth.
  • External: Growth that depends on factors outside of the business, such as partnerships, acquisitions or mergers with other businesses.
Illustration of a dog playing with a line graph

Illustration by Spoon Lancer via 99designs by Vista

The goals of business growth strategy

Whether growth is focused on revenue, product quality, or market share, the end goal of a business growth strategy is always positive change through innovation. That innovation can focus on the product, the process by which it is produced, the business model by which it is delivered to consumers or many other stages in the business/customer relationship.

As well as producing tangible results, maintaining and updating your business growth strategy improves internal company communication. Not only does it keep everyone on the same page, it encourages a culture of creativity and a willingness to consider new ideas.

Animation by Giaky® via 99designs by Vista

10 small business growth strategies

Market expansion

Market expansion describes business growth into a new market (an untapped customer base defined by shared characteristics). This involves researching the new market, producing fresh marketing campaigns and establishing inventive product distribution channels. Small businesses often take this step after their existing market share is well established since they can replicate their success with a proven model. Alternatively, when the existing market proves too competitive, market expansion becomes imperative.

Market penetration

Market penetration describes the growth of a business’s share within its existing market. First, small businesses split their market into narrower segments to identify customers outside their reach. From there, they increase brand awareness through marketing or address pain points, such as a difficult-to-navigate website. Some sales tactics, like offering unique rewards for first-time buyers, help businesses to steal customers right out from under their competitors’ noses.

An illustrated series of user avatars

User avatar illustration by yokunen via 99designs by Vista

Market disruption

Market disruption involves entering a long-established industry and offering an innovative product or business model that challenges the competition. This approach works best when the industry has been around for some time and the competition has taken its dominance for granted. While the disruption strategies may not be unconventional in and of themselves, what’s more important is that they are unconventional for the industry. Common strategies include new distribution channels (e.g. online), order fulfillment methods (e.g. next-day delivery), pricing models (e.g. subscriptions) or production processes (e.g. digital workspaces).

Customer retention

Although converting new customers is often an attractive growth strategy, focusing on this can be a mistake for small businesses. Rather, converting a one-time customer into a loyal, repeat customer is the essence of sustainable growth. It’s also significantly easier to strengthen existing relationships than to convince a discerning buyer to try something new. Customer retention strategies include loyalty programs, regular communications through newsletters and socials, and improving customer service resolutions around complaints, returns and poor reviews.

Animated cycle of various 3D-designed avatars

3D cartoon avatars by Valeriia_h via 99designs by Vista

Competitive pricing

Competitive pricing is a balancing act; it involves increasing or decreasing your brand’s price point as market demands require while maintaining profitability. Although lowering costs can decrease profits in the short term, it can attract new customers in the long term. Alternatively, higher prices contribute to the perception of high quality. It’s also possible to have it both ways through a subscription or tiered pricing model, both of which reduce the initial pricing entry point while accumulating profit growth over time.

Product development

Product development involves creating new products, as well as improving the quality of or adding new features to existing products. Auditing the market performance of your products and eliminating those that are costly and unprofitable is another form of product development. This growth strategy is often referred to as diversification, since it produces growth by expanding and diversifying what a business offers, allowing them to reach new markets.

Label design for a ketchup brand with multiple flavors

Label design by MANTSA® via 99designs by Vista

Workforce development

While customers often receive the most focus, another important indicator of business growth is the development of a workforce — whether in size, efficacy or skillset. Workforce development can involve expanding the workforce with new employees and departments or strengthening the skills of current employees through training, mentorship and productivity audits. Finding and retaining valuable employees means developing incentive recruitment strategies and fostering a positive, engaged workplace culture.

New distribution channels

The new distribution channels strategy means creating additional avenues, whether digital or in-person, through which you sell your products. If you are a brick-and-mortar company, for example, you might build an online store (or vice versa for an e-commerce business). You may also use third-party platforms like Amazon, Etsy or Yelp, open a pop-up shop, or establish a new franchise location. Increased distribution channels allow you to expand your customer base using the same products and business model.

New promotional channels

Promotional channels such as advertising, free content or direct outreach ensure that customers are interacting with your brand beyond the product. Expanding your promotional channels involves putting resources into new marketing campaigns, blog or video content, email newsletters and social media activity. This growth strategy is largely focused on brand awareness: the first stage in the sales funnel. While the road to an actual sale might be longer, brand awareness bolsters customer relationships beyond the transactional.

Branded food truck design for a German pastry brand

Branded food truck design by Catamejia via 99designs by Vista

Strategic partnerships

Strategic partnerships involve working with other businesses to familiarize their customer bases with your products. Partnerships can be temporary, such as guest posting on another brand’s blog, or permanent, like a high-profile joint campaign or product collaboration. Either way, the result is a win-win cross-promotion for both businesses, assuming they are complementary rather than competitive. For example, a bookstore might partner with a local café because the customers purchasing their products  — coffee and books — tend to overlap.. 

How to develop a growth strategy for small business

Outline growth goals

Because business growth strategy is about achieving results, concrete goals are an essential starting place. If you want to increase revenue, ask yourself: by what percentage? And from which customer base or distribution channel is that revenue coming?

Use SMART criteria (Specific, Measurable, Attainable, Relevant, Time-bound) when developing goals. Then, choose one of the business growth strategies listed in the previous section that best suits your goals (or create your own).

Homepage website design for a marketing agency

Website redesign by Sebastian ✅ via 99designs by Vista

Reevaluate your brand

A strong brand identity guides all business strategies, including growth. If you have not yet fully developed it, or need to reconsider elements of your existing brand identity, now is a good time to start. Having a clear idea of your brand’s target audience also stimulates growth, as communications and marketing can be customized and thus more effective. It’s better to do this early on, because as your audience grows, it will become more difficult to make major changes to how you are perceived without creating confusion.

Wordmark lettering logo design for an online education brand

Typography design by GREAT. via 99designs by Vista

Stay informed on the industry

Identifying key growth opportunities requires a thorough understanding of your industry, including its fluctuations. Research your competitors and pay attention to their business growth strategies. How they are diversifying their products, or distribution and promotional channels, can tell you much about the markets they are attempting to reach. Similarly, research your own current and potential markets. Tools such as user personas and customer journey maps can help you create specificity within the breadth of your entire audience.

Develop a small business growth campaign 

With your business growth strategy goals in place, you can begin developing a campaign tailored to your products and audience. This will describe the actual steps that your business will take to achieve consistent growth over a specified timeframe. This plan could involve an advertising campaign directed towards a specific market segment, putting resources into research and development of products, or working with management and HR to develop a workforce. Present the final detailed growth campaign to all employees for transparency.

Illustration of llamas working on a website

Illustration by Camila Mosso B. via 99designs by Vista

Measure growth results

Without the means to measure business growth, you won’t be able to accurately gauge the success of your strategies and goals. Although increased revenue is easy enough to identify, it doesn’t give you the whole picture. You need to know where that revenue is coming from to know which campaigns are succeeding. Pay attention to key performance indicators, or KPIs, such as inventory turnover, landing page traffic, organic search traffic, email signups, customer conversion rates, customer service resolution timelines and social media follower increase.

Don’t wait to grow your small business 

Remember, small businesses have the most room to grow. In order to grow in sustainable stretches, brands need an organized and clearly outlined growth strategy. There are many approaches to business growth, and the strategy you choose depends on the needs of your particular company. If you are still uncertain which growth strategy is right for your business, start by evaluating KPIs and significant customer feedback points. Once you’ve identified those areas of improvement, the real growth work can begin.