Will 2010 Be One to Grow On?

History tells us more businesses will fail at the beginning of a recovery than in the depths of a recession. This means thriving when the economy rebounds can be more challenging than surviving in times of economic difficulty — and here you were thinking you were through the tough part!

Let’s face it — 2010 will test the mettle of the channel partner community once again, revealing which partners have what it takes to mitigate risks associated with the last gasps of the downturn and first green shoots of recovery and plan for the next growth period.

Have you developed a robust plan for meeting demand as it returns? It’s time to shift gears from analyzing the risks on the downside to considering some of the risks on the upside. Let’s take a quick quiz on your growth plans and then revisit just what companies grow on:

1. Do you plan to grow in 2010? If so, by what percent?
2. Do you plan to hire any new people in 2010? If so, how many?
3. Do you plan to acquire new customers in 2010? If so, what percentage of your growth do you estimate will come from new customers?
4. Will you invest in better marketing in 2010? If so, how much more will you invest?
5. How will you fund your growth?

• Cash flow
• Personal investment
• Investors
• Other

None of the questions truly matters in this quiz except question No. 5. You would not be reading this article if you did not plan to grow. And, since you generally can’t cut your way to growth, you likely will hire people, which will necessitate landing new customers, which means you will need to invest in marketing to get them. Thus, the fundamental question becomes, how will you fund that growth? Failure to grow, or even survive an economic recovery, typically comes from one problem — insufficient working capital to fund growth.

You also must realize that not all growth is healthy. Many firms plunge headlong into unprofitable growth; rapid, unfunded growth; or unexpectedly slow, unfunded growth. None is a formula for healthy growth.

So what should you do to ensure your business grows profitably in the recovery? Here are some considerations as you plan for 2010 and beyond.

Get competitive. Someone is keeping score and you need to play to win. Your company can’t win unless you take the time to study your competition and understand how to play the game better. There are three basic elements to ensuring you are truly competitive — value-based pricing, marketing differentiators and customer satisfaction. To ensure you have the right competitive position ask yourself the following questions: