Scaling Up
~2 m
Session 7 - Growing the Company
What does it mean to grow a company?
Fundamentally you have to sell more things to more clients
- sell your core product profitably until you’ve saturated the market
- e.g. Coca-cola
- partner with adjacent companies to achieve dominance
- e.g. Starbucks & PepsiCo created the North American Coffee Partnership that now sells 97% of pre-bottled US coffee
- beat your competitors through marketing, quality or pricing until only you are left
- e.g. Proctor & Gamble’s advertising in the 70s & 80s made the the global king of nappies
- search for adjacent markets that are like your core market but are untouched
- e.g. Apple moved from computers to iPods to iPhone and became a telecoms giant.
- diversify - how can you use your expertise and new found profits to continue growth
- e.g. Nokia made tyres & cables for the military that led to consumer electronics then phones.
- acquire other companies - just buy the ones that enrich your portfolio
- e.g. Disney bought Pixar & Marvel to be dominant in fantasy stories
- franchise - essentially rent out the playbook for your business and people give you money to copy you
- e.g. McDonald’s franchised restaurants are 95% of the companies earnings
Review of previous session
From the last session, we will review:
- What actions did you take to cope with the calamity
- How much did you spend, how much did you earn, what does your balance sheet look like?
- Are you making a profit? Is there any money left to grow?
Vendball review
Vendball has been shaken by the regulation change. Did you find a way to succeed.
Vendball scaling
Have a good read of the growth strategies - which one(s) will work for you? Maybe they all look horrible?
For next time…
- Update your accounts to provide an estimate of how much you might spend in the next 2 months executing a growth
strategy.
- Use indeed to find salaries that you might have to pay.
- Remember the old adage - “If you pay peanuts, you get monkeys.”
- We’re gearing up for the final session - will the books tell a convincing enough story for someone to buy your business?