How do I grow this business?
“How do I grow this business? I push and I shout and I beg and I talk and I fight, but somehow the business feels stuck. It has got harder to move on to the next level and something needs to give."
3. Respond rapidly to changes in the outside environment. Change and risk go hand in hand and you need to make decisions while being acutely aware of how your outside world is changing. Changes in customers, customer needs and tastes, markets, competitors, the industry are very real. Changes in government, political, economic, social, technological, legislative and environmental situations also impact massively.
4. Putting up prices is usually a good thing. You lose your less desirable, customers, you lose those buying solely on price and you send a very clear message to the market that you are selling on quality not price.
5. Opportunities abound. Very often we just can’t see them that way. Too much “business as usual’”makes you lower the radar and miss the potential.
6. Follow a simple formula: talk – research – decide – act – review. Repeat quickly and with massive energy and enthusiasm.
Case study:
Hobbs House Bakery can chart five generations of bakers in the family, from early 20th-century roots in Gloucestershire right through to Tom Herbert, sales director and father of four aspiring, potential sixth-generation bakers.
Born with flour on their fingers, generations of Hobbs House Bakery’s directors bring their ingrained passion for baking to work every day, to uphold the noble lineage, and ensure that there is a solid future for REAL BREAD.
A business with a fantastic heritage, Hobbs House Bakery is in an environment 95 per cent dominated by supermarkets; flour prices have been doubling while competitors and customers alike are going to the wall.
Time to take the business to the next level.
A "formal" structure was put in place to create a "board" rather than a talking shop where decisions would be made. Actions were put in place and the results reviewed. Once the business brain is in place, it becomes easier to run the rest of the business. Along with the new look board comes the creation of a vision and direction that maximises both the potential and the specific aspirations of the players.
Inspired by the simple concept that you can aspire to be the best at what you do rather than the biggest, a new plan was created that did not depend on the stresses and strains of inevitable year-on-year growth. A smarter, cuter solution was required for this modest, almost camera-shy business that was literally a best kept secret, a butterfly waiting to explode from within the chrysalis that has contained it.
On reflection, the business had a reputation to die for. Winner of countless awards for its breads and with an avid following from the Gloucestershire celebrities (Liz Hurley et al), a vision of the future crystallised.
With 96 per cent of bread sales in the hands of the supermarkets, Hobbs House was, by definition, in a niche and that dominant position in the niche should be used to their advantage.
Baking “probably the best bread in the country” brought with it countless opportunities. Each of these were considered and then the appropriate action taken:
- Prices went up to reflect the quality of the service and astronomically increased costs – the impact on sales unit volumes was negligible
- Tom began a flourishing media career being invited onto BBC radio and television as the "face of bread", doing “what Rick Stein did for fish” for bread!
- To compensate for untapped demand across the country, new technology and innovative thinking enabled the bakery to start distributing nationwide through the use of partially frozen doughs
- The big, contrarian, industry-challenging innovation of online bread on demand was launched to cope with the ever-increasing and geographically-spread demand.
This combination of opportunities, technologies, changing tastes and demand enabled the business to significantly grow in a recession.
You will see more of Hobbs House Bakery. Try their bread and you will be become a convert. They will not compromise their principles as a business or as a family and will take on their inevitable popularity in their own traditional manner… one loaf at a time.
Robert Craven spent five years running training and consultancy programmes for entrepreneurial businesses at Warwick Business School. He now runs The Directors' Centre and is described by the Financial Times as "the entrepreneurship guru". Robert can be contacted at: office@directorscentre.com