The 7 Stages of Starting and Running a Business

• Seed Stage

  The seed stage is when your business is just a thought or an idea. Most businesses will have to overcome the challenge of market acceptance and you must focus on matching business opportunity with your skills, experience, and passions.

• Start-Up Stage

  Your business now exists in legal terms! Products or services are in production and you have your first customers. The main challenge is not to burn through your funds. Learn what profitable needs your clients have and do a reality check to see if your business is on the right track at this stage. Most start-ups require establishing a customer base and market presence while conserving cash flow.
  

• Growth Stage

  Revenues and customers are increasing with many new opportunities and issues. Profits are strong, but the competition is surfacing. Learning to manage a consistent range of issues at this stage is crucial. Focus on running your business in a more formal fashion to deal with increased sales and customers. Improve management systems and hire new employees to deal with the influx of business.

• Established Stage

  Your business has now matured into a thriving company with a place in the market and loyal customers! Sales growth is not explosive but manageable and business life has become routine. It's important to stay focused on the bigger picture by improving productivity to stay competitive and retain customers. To compete in an established market, you'll need automation and outsourcing to improve productivity.

• Expansion Stage

  Your company is growing into new markets and distribution channels. This stage is often the time to choose to gain a larger market share and find new revenue and profit channels, if desired. After planning and researching, add new products or services to existing markets or expand your business into new markets.

• Decline Stage

  Changes in the economy, society, or market conditions can decrease sales and profits quickly leading to struggle. Businesses in decline will be challenged by dropping sales, profits, and negative cash flow. The biggest issue is how long your business can support negative cash flow in this stage. Consider if it may be time to move on by seeking out new opportunities and business ventures while cutting costs and finding ways to sustain cash flow.

• Exit Stage

  It's a big opportunity for your business to cash out on all the effort and years of hard work you've put in. Selling a business requires a realistic valuation. If you decide to close your doors, the challenge is to deal with the financial and psychological aspects of a business loss. Get a proper valuation of your company. Look at your business operations, management, and competitive barriers to make the company worth more to a buyer and setup legal buy-sell agreements along with a business transition plan.