As the economic environment comes alive from its years-long slumber, many business leaders are waking up with a voracious appetite for growth. Many businesses survived the economic slowdown by doing more with less and scratched out whatever growth they could when they could and their leaders are now coming to the table ready to feast on new opportunities, the competition's weaknesses or both.
Business growth takes many formats. Maybe the fastest way to grow is to simply buy market share by purchasing a company. In recent months, the foodservice industry has seen a spate of acquisition activity with Middleby purchasing a pair of equipment manufacturers and Henny Penny buying Wood Stone (page 11) serving as two recent examples. Before that, the dealer community made some headlines when Sam Tell & Son bought Paramount Restaurant Supply Corp. and Foodservice Warehouse acquired Loubat Equipment Co. On the operator side, Roark Capital, a private equity firm, purchased CKE Restaurants, allowing the venture capital firm to grow its restaurant portfolio. And if the rumors are true, more merger and acquisition activity may be on the horizon.
Of course growing via acquisition requires deep pockets or a working relationship with private equity, attributes not every company has. Companies lacking these attributes are left to pursue growth organically by acquiring new customers or by developing new products and services.
While the tactics business leaders may select when attempting to plant the seeds for growth can vary, their approaches must all have similar traits. For example, any growth activities must be clearly within a business leader's field site when viewing them through the lens of the company's mission and vision statements, which means the new initiatives will likely work in concert with the organization's existing products and services.
Indeed, there seems to be no shortage of good ideas today but not everyone may be right for your company. Simply reacting to a competitor's actions or trying to grow for the sake of doing so can cause considerable harm to a business. What you do and how you do it has to support the reason an organization exists and its long-term objectives.
Clearly think through and take the proper time to implement new initiatives and avoid the temptation to rush them to market. It's also important to make sure the organization's existing infrastructure, including its processes, procedures, platforms and people, can support the new initiatives. This includes balancing the needs of customers and employees. If implementing a new initiative keeps employees from executing the core business at the optimum level, a brand's promise begins to erode and the business could subsequently suffer. Consultant Juan Martinez of Profitality continually reminds us of this important fact in his blog, Foodservice by Design, at fesmag.com.
Growth propels businesses forward but how a business grows is equally important to its long-term success and sustainability.