How Expanding Your Capabilities Can Fuel Your Company's Growth

It's all about tapping into additional capabilities and services which, ideally, closely relate to what you already do.

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Think about the future you want for your company. Does your growth chart go up and to the right in your head? It should.

But everybody else has the same goal, and they're working hard to grow faster than the rest of the competition so they don't lose out. And this growth is currently occurring everywhere. Of the 923 fastest-growing companies in the U.S. by region, two-year revenue increases for 2022 range from 145% to 253%.

Many companies try to expand by selling more of what they already do through product-led growth strategies,implementing the creation of customer loyalty programs and leveraging global platforms.

But how do you grow faster than the competition without sacrificing stability? It's all about tapping into additional capabilities and services which, ideally, closely relate to what you already do.

What's An "Additional Capability" And How Does One Help?

An additional capability or service is simply an extra offering you can present to your customers that brings more value and convenience to their experience. You see this at gas stations all the time. Sure, people may show up for their fuel, but the chance to get their favorite slushie or protein bar at the same time can sweeten the deal. If enough of those sweeteners are offered at the right price, people might stop at a specific store for those items even when the gas price there is a couple of cents higher than that of the competitor across the street.

In this instance, the gas station is simply applying what they already know about doing well when it comes to gas — facilitating maximum convenience and speed — into the food niche. This is the same concept behind so many malls or other retailers grouping fast food joints together. There's convenience in having many different options in one place when Mom likes tacos, Dad likes fries and the kids want chicken.

Buc-ee's is a convenience store chain that's mastered the approach of adding new capabilities. From day one, founder Arch Alpin III drew on his family's entrepreneurial history of providing unique products customers couldn't get anywhere else. He designed the first store to have a different look and more space than most of his competitors. AndAlpin has continued expanding the stores' footprints, with the largest of the 34 Buc-ee's offering 68,000 square feet, making it the world's largest convenience store. This success stems from the company using its core capabilities and adding new ones that were closely related to them over the years.

The Challenge Lies In Identifying Opportunities For Added Capabilities.

My company has tapped into this strategy, too. Early on, we were set up to rent passenger vans to summer camps. We knew how to get vehicles all over the country and back and possessed the tools for that. Last-mile delivery takes basically the same skills and assets, so eventually, we recognized the opportunity to extend into this bigger market. The move let us expand by not hundreds but thousands of vehicles.

Figuring out and adopting an additional capability or service can keep existing customers happy: Customers who always shopped at your gas station will keep filling up at your location as you add new products and features. That's important because it's usually cheaper to maintain customers over timethan it is to find new ones. But it can also attract people into your fold that otherwise wouldn't use your business. You'll get those people who want the killer snacks your gas station provides or who are looking for someone to ship a package. The extra money both old and new customers are spending on your additional services pumps up your profit margins.

Lastly, thinking critically about what else you can do allows you to ditch what's no longer helpful to you. Consider how gas stations got rid of the mechanic shops people weren't using and pivoted to partnering with restaurants. It's a powerful way to trim dying branches from your company so you can direct your resources toward helping new ones flourish.

How To Find Your Additional Capabilities.

To identify what else you can do for existing or potential customers, consider someone who's just come into your company, such as your new intern. This type of worker is fresh enough to the business so that, unlike your regular from marketing who's been with you for years, they won't be blinded by biases.

Have this person identify at least five of the fastest-growing companies in your industry. Then, use their websites or other public information sources to make a list or chart of all the offerings they've got. Finally, compare that to your own offerings. Where are there gaps between you and your competitors?

Now you've built a clear road map of areas where you can improve the customer experience and grow. If you do this andfind some innovative ways to provide customers with options they can only get from your brand, you'll stand out among the competition.

Remember To Be Realistic As You Scale.

Not every business needs to focus on growing faster than its competitors. Some businesses are perfectly fine if they aim for, say, 5% growth a year. Though there are some exceptions like Amazon that use this major growth through additional capabilities as a long-term strategy, most businesses can't keep muscling through thatfor years and years. The best option is always one you can sustain and scale over time, so you'll likely be served better by seeing additional services and products as a short-term growth strategy.

But don't be afraid to tap into this tactic when it makes sense. As long as you're keen on what customers like and are open-minded about ways to maximize what's already at your fingertips, you can adjust your physical space and catalog in a way that delivers the immediate growth you're after.

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