Moving from recovery to growth

Taking your business from a process of recovery to one of growth requires adaptation.

While the coronavirus pandemic has stopped many businesses from functioning as normal, it hasn't prevented them from adapting.

From searching out new markets to offering innovative products and services, businesses have sought fresh opportunities to engage with customers and keep growing.

Are you ready to grow?

If you're a business that's been struggling for months, this may still appear to be a valid question.

Yet having a clear focus on the fundamentals as you start to rebuild should make the path to growth much easier.

According to David Petrie, Head of Corporate Finance at the Institute of Chartered Accountants in England & Wales (ICAEW), the most important thing that businesses can do is to make sure they don't run out of money.

"Sound working capital management has to be the first place to start," he says.

"Companies should also now be focusing on medium-term commitments [and] restructuring the balance sheet to reduce gearing.

"But in order to do that, at least in part from retained earnings, identifying market opportunities so the business can trade profitably and effectively in the new environment has to be the approach.

"Businesses that are quickest at identifying and filling market niches will be most successful in attracting fresh investment to support growth," he adds.

The move from recovery to growth may well be imperceptible, but you're less likely to achieve it without a laser-like focus on the fundamentals that will make your business a sound proposition.

Develop digital capabilities

In a remarkably short time, COVID-19 forced many businesses to begin a digital transformation process involving remote working.

For example, instead of salespeople being on the road meeting clients face to face, businesses have found that they can successfully deal with customers through a centrally based salesperson.

They sell by researching the requirement, making contact through social media and using video conferencing to get to the decision-makers.

Often more can be achieved in a half-hour video call than an extended face-to-face visit.

As a business, if you successfully exploit this new landscape, it may offer great opportunities for future growth.

Virtual teams

Of course, managing virtual teams brings its own difficulties if you don't have the appropriate skillset and tools.

At the same time, it presents opportunities if you're able to use new collaborative software to create more effective teams.

As the fundamental building block of modern organisations, teams must evolve as an integral part of such a seismic shift in order to meet the rapidly changing internal and external demands.

The notion of Team to Market allows business leaders and knowledge workers to understand and create effective teams in ways that might be inconceivable only a few years ago, by taking advantage of the significant new capabilities afforded by a new generation of workplace collaboration technologies.

Nevertheless, in seeking to use digital technologies to move beyond recovery and grow, it's important for your business to:

• understand when technology doesn't deliver value, and limit the risks of this happening
• learn about cyber security threats, identify vulnerabilities and plan how to deal with them

Innovate

The ability to find creative solutions to problems is a skill seen in many successful entrepreneurs and businesses that have survived major economic crises.

Smaller companies are well placed to develop innovation by experimentation.

Indeed, it's often a necessity as they often lack that high upfront investment.

According to the New Horizons report from the Federation of Small Businesses (FSB), 16% of small businesses developed their online presence during lockdown, while 10% developed new services and 6% new products.

Furthermore, remote working has unleashed creativity.

According to the Chartered Management Institute, 66% of managers have reported increased levels of innovation among staff during this time.

It is, without doubt, of great value to encourage a culture of creativity and innovation.

Find capital for expansion

Once your business is seeking to expand, it will need capital to fund that growth.

There are various routes to finance, including the following:

• Using capital you've generated yourself, from retained profits
• Equity finance
• Debt finance
• Funding/grants from central or local government

If you're considering finance, you should seek expert, independent guidance to help you determine which source of capital is most suitable for your needs.