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Every Company Plateaus: Here's How to Get Up and Over Yours

Updated: Jun 10

Do you feel as if your business is struggling to grow? After investing your heart and soul into your small business, a growth plateau can be a nerve-wracking experience. Fortunately, it is quite common to witness a leveling off of growth. This commonality among all businesses also means that it is well-funded in terms of solution creation.

"How do I grow my small business and overcome its current plateau?" -You... Probably.

Picture of a mountainous plateau with a blue, partly cloudy sky
There's ALWAYS growth beyond the plateau!

It is no exaggeration to say that literally every company levels out at some point or another, often repeatedly over the lifetime of the business. It is also highly probable, with the right solutions, to overcome any plateau and get revenues expanding again.


First Up: Understanding Business Growth Plateaus

An open sign hanging in the window of a local coffee shop with some antique looking lights throughout the inside
Looks Cozy Inside!

A business plateau is possible at any stage of the business cycle. However, it is more common within the early lifetime of a business. As a ‘new’ business you have much more potential for people to first discover your business and give it a test run.

What exactly is a growth plateau?

The basic explanation is that this is a period where your revenues month over month etc. see a stagnation of growth. The key here is that you don't necessarily see a backslide of negative growth, but rather a flattening stabilization. If you were to place your revenues on a graph, the left hand side is your growth period followed by a flat period of no growth.

Here's a great example of a plateau: If your product consists of a novel service or product you will likely have a period of experimentation from your customers driving at least a portion of your total sales. As those experimental customers decide whether to purchase your product in the future or not, you’ll witness what we call the First Growth Plateau.

The First Growth Plateau can occur at wildly different times for a new small business, but it rears its head - always. This phenomenon is triggered by varying reasons, but the most common is when the sheen wears off your business and you start to become established.

It is important to remember that reaching a plateau does not necessarily mean that you’re the cause. In the example above, the leveling off of your new sales is simply a natural step in the business life cycle. Besides, businesses plateau for any number of reasons. They occur most often during transitions in your business cycle and often because of things outside of your control. Because of this, you're more than likely to experience several throughout your business ownership.

a panoramic image of a lush forrest valley with mountain plateaus on either side.

Identifying the Many Versions of a Plateau

Before we dive in to some general solutions, it is first important to understand how to be

vigilant in identifying an impending slump. Similar to other nefarious items of life, the earlier you are able to identify them, the easier they are to rectify. Recognizing plateaus while they're still in an early phase requires an examination of a few details.

small businessWoman looking in a hidden cabin.
Well hidden, but worth finding.

The trickiest part about any of this is that they can present themselves within any dataset. Another way to put it is that they can hide themselves between a whole host of areas of your business; each of which can be devastating or, as we will soon explain, maybe even helpful to your business.

Here are some critical areas to be mindful in your analysis, but keep in mind these are but a few examples.

Revenues or Profit

Image of a graph showing three bars of growth and then 4 bars of stagnation
Growth Plateau Visualized

Believe it or not, these two are mutually independent in terms of growth plateaus. It is quite possible for revenues to taper off while profits soar and visa versa depending on many factors.

One example: your customer base may be somewhat limited, but you invest in cost reduction efforts. In this scenario you should expect your revenues to level out because of the limited customer base. While at the same time your cost reductions enable profits to rise. Without understanding your market and identifying the need for cost reduction early, you might expect BOTH to decline.

Cash Flows

a chalk drawn graph that shows an initial decline leads to a gradual incline
Silly graph, but you get the point.

While clearly cash flows are related to revenues/profits, there is a potential for cash flows to not match in terms of growth.

For example, as you grow you may decide to implement some sort of financing option for your customers. This likely will open the window for more sales since you’ll be unlocking the ability to purchase even if cash isn’t fully on hand at the time of sale.

However, this also means that your initial sale cash flow will reduce relative to the total potential invoice values. (Note: this is often a good thing as to space out your regular flow over time; guarding against sales troughs.) In addition, you are likely to run into delinquency issues which can affect cash flows and profitability.

Customer Satisfaction

image with a bunch of hands with thumbs up and the words customer satisfaction leads to growth on the background

One of the most emotionally impactful data set for a growing small business is the customer satisfaction. Early on in your business’ life cycle, it is a heck of a lot easier to maintain exceptional customer service. But as you grow, and your customer volume rises, you’re exponentially more likely to see a dip in overall satisfaction.

In fact, you could run an absolute PERFECT operation and still likely see a decrease in this metric. Let’s be honest, we all know there are those customers out there that are never satisfied; and as you grow you are more and more likely to encounter these people.

Mitigate Plateaus by Trusting in Those Around You

image representing customer satisfaction surveys
Survey yourself, employees, and customers

As a small business owner, you may work independently, but chances are you have a team working with you. The first step in mitigation is to check-in with yourself and any employees you may have. Take a moment to consider their engagement, motivation, and performance. These can all affect your growth.

The key here is to also check-in with their thoughts on the business and any shortcomings that they may see currently or even foresee for the future. When overcoming a plateau you'll do so mostly by modifying the business in some way. This allows you to already be one step ahead while also empowering your employees.

Do the same thing for your clients. Make sure clients pay on time, and any expressed concerns are met. Don't fear a customer satisfaction survey, either; client feedback is valuable. Voice of the Customer is an incredibly powerful tool yet is rarely implemented by small businesses. By implementing a Voice of the Customer Survey program you gain the ability to monitor for the customer satisfaction plateau.


How to Create the Strategic Growth Plateau

Did you know you can plan for a business plateau? As with many things in life, and especially business, you can often take something harmful and turn it on itself to benefit your business. Plateauing your business at strategic times can become a significant formula to your overall success.

guy doing a backflip off a hill on a beach somewhere
Flip it to your advantage!

The same can apply to something positive being flipped against you as well. Let’s say that revenues and new customer growth has simply exploded for your business. So much so that you now find yourself in the position of delays, quality degradations, or other harmful effects. A strategic growth plateau can serve as a way to preserve scalability and your business's growth of its various processes over a planned period of time.

To give you an example of how to launch a planned plateau, let’s hypothesize that your small business has a deficiency in manufacturing of your widget. An explosion of sales would produce a significant backlog along your assembly line. This introduces the risk to customer satisfaction in late delivery, quality control in rushing production, or even making your sales more vulnerable to external influence. To turn the tide against those potential problems, you may decide to limit your sales purposefully. Something along the lines of “limited quantities available” or if you know the product itself has a limited life, you may consider issuing the product as a ‘limited edition.’

For service-based businesses, you can simply adjust your scheduling to reflect the demand for your service. So, something along the lines of "we are booked out 3 months." Unlike widgets, for services you have be diligent to not overbook yourself thinking you can still manage.

In both the ‘limited editions’ or ‘booked up’ plateau strategies you not only mitigate your production limitations, you also create a marketing boon that builds the impression that your product or service is exclusive or a cut above the competition.

Guy holding back a boulder on a hill
If you're caught off guard you'll feel like this guy.

Planning for intentional vs. reactive ways to grow your business requires proactive action. We’ve already mentioned that monitoring and catching a slowdown early is the best way to mitigate. But there are many other ways to ensure the momentum of your small business keeps moving upward.

How to Move Past the Plateau and Start Growing Again:

Use the following areas as possible points to push your business off its plateau.

Start by Reviewing Your Business Plan

How long has it been since you created your business plan? Did you ever make one? If it's been a while, your first step is to evaluate your current plan. When you do this, you also need to examine your current vision, business goals, and pricing strategy. A business plan review opens the door for all kinds of adaptation.

Full Disclosure, we have a love-hate relationship with business plans. You’ll rarely, if ever, look at it. We always recommend placing your primary focus on your Strategic Marketing Plan instead. -Ryan, CEO

notepad with a few notes about a business plan jotted down laying next to a coffee mug with some tea

Chances are high that since the time you originally wrote your business plan you’ve gained an enormous amount of business intelligence. You likely made assumptions that were not quite accurate or perhaps you flat out missed an angle that came to light after you opened.

This gap in knowledge is typical and expected, but it also is a likely cause for your business to experience a plateau.

In order to maximize your small business’ growth, you must always be operating with the most current and accurate information. This is an excellent time to take some of what you’ve learned in the recent past and update your business plan.

Here are a few examples of what might have changed or need adjustment:

  • Sudden economic changes

  • New Competitors

  • New consumer trends

  • Current and future products and services

  • Environmental changes

Your plan doesn't need to change all that often unless it's a reactive maneuver to uncertain circumstances (e.g., a pandemic). Pivoting as needed allows you to implement immediate and long-term changes to push your business growth into motion.

person holding a tiny strip of paper that says think positive on it

When you stop focusing on the negative “my business is struggling to grow,” you'll find yourself considering positive, attainable goals.

This kind of evaluation also allows you to explore bigger goals. If you've been struggling with thoughts like, "I want to grow my business, but it’s not happening fast enough," new goals revitalize your strategic vision and add a bit of perspective.

Use the The Competition Effect and Measure the Market

If you haven't yet thought of your competition (with respect to your plateau), now's the time. Your competition will provide you a two-front battle for information. On one hand they could be the actual cause for your growth plateau, but on the other hand they could be a useful bellwether to other market forces and evidences.

The Bad News:

two small business owners locked in a heated match of arm wrestling

Your competition could be creating disturbances in the market that is leading to your stagnation. Perhaps they have released a new product or are a new entrant into your industry altogether but are outperforming your business for one reason or another.

Competitive slowdowns are incredibly difficult to navigate and take valuable time. You need to complete a full analysis of each competitor, their products, their brand, their quality, etc. and compare their offering to yours. With that information in mind, you must adjust your own model to recapture the lead.

The scope of such an undertaking often requires additional help. Cheap plug aside, we strongly recommend that you investigate adding on a business coach or similar consultant to assist you. They can alleviate some of the workload while also adding significant expertise.

The Slightly Better News:

It’s not quite ‘good news’ so to speak, but it is quite possible that your competitors are also experiencing a plateau along with your business. These types of plateaus are much easier to identify and strategize.

group of four friends locked in arms watching the sun rise over a valley
You could be in it together with your competitor

If your local market is experiencing the same downturn simultaneously then the likely culprit is going to be something external to your respective businesses. Think along the lines of economic depressions, environmental changes, reduced interest in your products (as an industry). None of those are “good,” but they are much easier to design your strategy around compared to some other business simply outdoing you.

Plus, if everyone is in the same boat, then it is likely that the possibility to collaborate with your competition on a solution is possible; working together to save the industry ship rather than all sinking together.

Turn to Other Small Businesses: You're Not Alone

Along that same line of thinking, how much of your business relies on the processes of your suppliers or service providers? Likely your business engages with other small businesses within your area in some way or another. Did you build your website or purchase supplies for your widgets locally? What about that business coach that you hired?

a couple riding bicycles with each other with the woman reaching an arm back and the man reaching towards her all at sunset.
No Shame in Asking for Help!

The key point here is that all of these small businesses rely on or are otherwise heavily invested in your success. They have a strong incentive to aid your business in order to ensure their own small business’ success.

There is also a good chance that they have either gone through a plateau in the past or are going through the same one you are currently.

If you have a solid relationship (or even if you don’t!) with any of these partners, then take a moment and reach out. There is ZERO shame in confiding in and asking for help from your fellow small business owners. The fact of the matter is that they know, intimately, what it feels like to live and breathe a business. They will likely, at the very least, offer sympathetic support. So again, reach out!


Keep Pushing Past Any Small Business Plateau

In your gut and fueled by ambition, you know it is time to keep pushing your business ahead. Additionally, with this article you now know what causes business growth plateaus, as well as knowing how to overcome them (more or less). But it can be daunting to approach your various solutions alone, especially if you're highly dependent upon your small business.

Instead of worrying, "How do I grow my small business all on my own?" turn to a business coach such as Out of the Box Advisors. We offer the business coaching you need, starting with a free consultation. Book your consultation to discover how we can spark growth for your unique small business.

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