Homework Question on Stages of Business Growth
- Describe the characteristics of each of the four stages of growth a business organization might experience.
- Provide examples to support your description.
- Follow APA format for structure.
Homework Answer on Stages of Business Growth
A business organization usually grows through four classified stages. These stages assist the management to acknowledge the stage at which the firm is and apply the appropriate measures to deal with the challenges that they face in each stage. These stages are existence, survival, success and maturity.
- a) Existence Stage
This is the initial stage in which the entrepreneur develops a business idea and actualizes it into a real business. The entrepreneur raises capital to establish the business and he is personally involved in the day to day running of the organization. The firm majorly depends on the customers for its existence and it will strategize in identifying and attracting its customers.An entrepreneur with a business idea to open up a local shop at his backyard will gather capital and open a shop that will be selling various household items. The entrepreneur will personally run the business and ensure it runs efficiently.
- b) Survival Stage
After successfully going through the existence stage, the entrepreneur aims at making profits to cover the costs incurred, that is, obtain enough money for its survival. The various costs incurred such as purchase cost should be covered by the profits made. This is a critical stage for entrepreneurs as most firms do not go past this stage as they are not able to make enough profits to cover the operational costs.