An Introduction to Growth Strategy in Home Improvement
- Identify your key performance indicators (KPIs) to identify growth areas
- Quantify what growth looks like for your business
- Employ strategy or tactics to achieve the desired KPIs
- Start to grow your business now
When it’s time to grow your business, it can be hard to know where to start. Luckily, there are metrics that you can use to begin measuring what’s impactful and what’s not. When you begin to quantify your business decisions and track your progress, it’s easier to see the steps you need to take towards greater profits and business growth. This type of growth strategy is often referred to as incremental growth, the process of growing little by little to meet big goals.
Why Key Performance Indicators Matter in Home Improvement
It all adds up. Incremental growth is based on the performance of your company based on key performance indicators or KPIs. KPIs are metrics you can use to define the most influential components of your business goals. For some businesses, this means identifying sales targets or the measurement of product performance. For others, its monitoring customer attention and average purchase value month over month. No matter which ones you choose, KPIs should align with the objectives of your business. There’s no such thing as building a business in one day, but you can start growing your business right now based on your goals.
Think of key performance indicators as the language that you would like to see on a report. What would be most helpful for you to know so that you can interpret what’s happening in your business and change it? Whatever you decide, the metrics are crucial to observing patterns and achieving greater successes as a business. Think of it like this, in an email sent to your chief financial officer, it’s the difference between saying your sales team “did well” or “increased sales per representative by 25%” in the third fiscal quarter.
Once you’ve identified your key performance indicators, focus on the areas where you can implement strategy or tactics to move the needle and grow your business. Incremental growth isn’t about how fast you can change, it’s about how effectively you can change without rocking the boat and disrupting your day-to-day.
Achieving Incremental Growth in Home Improvement
Many businesses want to experience incremental growth through increased ticket size or average order value. However, it’s easier said than done. There needs to be a sound plan in place to achieve this goal. Larger orders aren’t going to magically appear without a little work involved. Start with an evaluation of a few KPIs that might make this goal more attainable.
First, look at your business’ sales growth. At the very least, see how it compares to this time last year. Whatever the percentage is, you’ll want to set a goal to increase it to achieve incremental growth. Perhaps you set the goal to increase sales growth by 5%. Increasing sales growth can be done by taking advantage of more sales opportunities. Next, it would then be wise to evaluate your sales opportunities and see how many sales you’ve been missing out on. Last, you could quantify the value of the missed sales opportunities. Ask yourself, if you close 10 more deals this year, could you see 5% in sales growth by this time next year?
Identify Needs and Grow Your Business Now
The metrics that you will need to achieve incremental growth are specific to your business. Incremental growth is scalable and achievable if you pay attention to the details. Incremental growth can be achieved by setting higher sales targets, training your staff to promote premium offers, or simply by closing one more high-value deal a day than you did last month. You can optimize your business’ performance by identifying key performance indicators and using them to measure your incremental growth. Before long, you’ll be able to see your business growth in analytics, and hopefully, in profits.
If you like the information in this post, you will enjoy learning even more about growing your business by reading our latest white paper, Scaling Through Sales Expertise: A Guide for Business Owners.