But businesses don’t just grow by themselves.
You need to have goals and an action plan for your business.
How To Grow Your Business For The Future
Your plan has to consider the short, medium, and long term goals and activities of your business.
I like to view this as a process involving a series of multiple income flows which develop and mature over time: the short, the medium, and the long term.
When you start a business, there are a whole number of tasks and routines that you have to perform over and over again.
You have to promote your products or services. You have to find clients, attract customers, make sales. You have to do the work involved in providing your service.
Basically it means that you are self-employed.
But if you just keep doing the same tasks and routines, although you’ll be earning a living, your business will never be able to grow very much.
You’ll still only be self-employed. To grow your business beyond that, you need to think beyond being self-employed.
The first thing you have to do is to gradually change the way you carry out your business tasks.
You have to start automating your procedures. Begin replacing manual operations with bought-in software and with systems located out in the cloud. You need to buy in services from external providers.
You may have to contract out some activities. And you might have to appoint freelancers to take care of some tasks. You might also have to start employing staff directly yourself.
All these things cost money, but they are essential if you want to grow. They are the means by which you get into the position to move to the next stage.
But you need to do much more than change the way you carry out your procedures and tasks.
You also have to consider the activities your business will be focusing on over the short, medium, and long terms.
First, let’s take a look at the short term.
The Short Term
The short term is our immediate situation. It’s the here and now and so it’s always present.
It’s what we have to always pay attention to first and foremost. We have to be able to pay the bills, pay our rent or mortgage, pay our taxes.
For the immediate situation, our business has to generate immediate cash. In other words, we have to have a “cash-cow”.
This cash-cow doesn’t have to bring in a great deal of money. It just has to earn us enough to pay the bills, cover the overheads, and to enable us to live at a basic level.
No-one ever got rich by keeping a cow for milking. But a milk cow does at least give you a source of milk which you can sell at the market and use to buy the basics in life.
For me, my “cash-cow” is my IT work, my content writing, and my affiliate marketing activity. This doesn’t earn enough to make me rich, but it brings in enough to cover my immediate needs and living expenses.
The Medium Term
Next you need to think about the medium term. Where is your business going over the next one to two years?
You need a project for your business which will bring in more revenue in the future and generate profits which will give you more options.
My medium term project is to develop my sales copywriting skills.
Sales copywriting has much higher income potential than content writing or IT work. I also find it more interesting than content writing.
So my medium term plan is to continually work on my copywriting skills and source high value copyrighting projects from clients who need high-converting sales copy for their business.
The Long Term
Long term projects are the activities which require you to invest much more time, more financial resources, and more know-how than the medium term ones.
And in return, the long term projects will generate a much greater level of income and help you build a high value capital asset in the future.
My long term project is to develop a service which provides a high value to people in a specific niche by meeting an important need which is not being well catered by other businesses.
This project is going to take me longer to get going – probably two or three years, and so for that reason it’s a long term project.
You Need All Three Projects – Short, Medium and Long Term
The point is you need to have all three activities or projects – short term, medium term, and long term under way in parallel at all times.
If you just work on the immediate short term activities, then your business will never develop beyond that. You’ll remain small and your business will never properly expand.
This is because all these three elements are interdependent.
You can’t afford not to sponsor the medium and long term projects, any less than you can afford not to have the short term activities.
Your long term projects will in due course become medium term ones. And the medium term ones will eventually also become your short term ones.
What really matters in the long term is your long term project. Followed by the medium term.
The short term is also important. In fact, it’s vital, because without it, you can never afford to maintain the medium and the long term projects.
What Are the Time Periods for Short, Medium, and Long Term?
So what are the actual time periods for the short term, medium term, and the long term?
There’s no hard and fast rule. It varies according to the individual, the business and niche.
But here are some general rules of thumb.
Obviously the short term is always the here and now, plus the next 3 or 4 months or so.
Medium term I would say extends from about 6 months to approximately a year or so.
And long term covers anything beyond a year or a year and a half to perhaps two, three or five years or so.
But try not to make the long term too long term – or your project might not ever get to fully see the light of day.
The more time you allocate to a project, the easier it is to keep postponing it. There has to be some element of urgency for it to see the light of day.
For some businesses, these time periods might be longer. For others, they will be shorter.
Particularly in the digital economy, where one “Internet year” is often said to be the equivalent of the “dog year” – ie seven normal human years. Things happen and change very fast online.
Your Activities Will Vary for Short, Medium, and Long Term
The kind of activities you pursue for these short, medium and long term periods will also differ.
For the short term, it’s the immediate, cash-cow, “bread and butter” stuff which brings in immediate revenue. It could be activities which maybe aren’t that exciting or interesting. It may involve repetitive or boring grunt work, but it brings in money to pay the bills.
As your more higher earning medium term projects come to fruition and start generating revenue, these can take the place of your present “grunt work” short term activity. You can then automate, contract out, or appoint employees to take care of the short term immediate tasks.
If you look at Richard Branson’s Virgin business conglomerate, you can see all these features present – short, medium, and long term activities. The long term goal for Branson right now is the Virgin Galactic project.
You don’t have to keep your project activity fixed over this time. It’s important to be flexible and to adjust your project goals for the medium and long-term as they develop and as your circumstances change.
Businesses take time to generate revenue. Often when they start there are no customers and no revenue.
In fact, that’s practically the logical definition of a startup. Especially a digital online startup.
It’s like being a farmer. Land has to be prepared, crops sown. Then watered and fertilized.
Only later does the crop yield arrive. Or sometimes fail to arrive, if there’s a bad harvest for that year.
But if you don’t plan for the medium and long term – then all you’ll ever have is the short term.
Good luck with your business diversification – and your short, medium, and long term planning.