How to identify future growth opportunities and untapped business potential

We’re operating in a business buyer’s market. This means vendors who are keen to sell their business must be prepared to do some legwork to find the right buyer and achieve the most profitable outcome. Identifying untapped business potential and possibilities for future growth is one tactic vendors are using to achieve a higher valuation and attract prospective buyers.

Identifying growth opportunities is not about creating additional work for your leadership team. You don’t have to create and execute a business development strategy in order to sell your business. The seed of an idea, a customer commitment, or detailed research could be enough to add significant value to your business in the eyes of a buyer.

Buyers are looking for strategies that will lead to sustainable business growth. If you plan to sell and exit your business this year, researching what that growth could look like is a good place to start.

Do your research

Buyers perceive value in opportunities to scale a business, so keep this in mind as you carry out your research.

Listen to your customers

Consider existing customer feedback as a primary source of information about customer needs and wants. Analyse online reviews and feedback on social media for hints of challenges and problems customers would like your business to solve. For example, travellers tend to be very honest in their review of a hotel or accommodation, pointing out where their needs have not been met, which could highlight untapped potential.

Would your customers be responsive to a feedback survey (not all are)? If so, carefully worded questions could generate valuable suggestions for future products and services. And, if you change your mindset and look at customer complaints as an opportunity rather than a threat, they can be a goldmine for feedback.

Review sales data

If you sell online, take a look at your website analytics and identify which products/services are popular and not so popular. Which products or services are people searching for on your website, but perhaps not finding? Review other sales channels to understand whether there is potential to expand or enhance your product/service mix for your customer base.

Be alert to industry challenges

Evolving markets can be a source of new opportunities. Stay flexible so your business is ready to respond to change.

Revisit past plans

We all have plans that we have shelved because we realised our team didn’t have the skill set or knowledge to deliver. Resurrecting these as part of your growth strategy could be attractive to a buyer who does.

Talk to suppliers

Have an open conversation about your plans and float the idea of developing a long-term partnership – which may even become the source of new ownership.

Consult a business broker

Part of a broker’s role is to help vendors achieve the most profitable sale price for their business. If our initial valuation doesn’t match with yours, we can work with you to identify ways to increase value from the perspective of a buyer. Find your local business broker and ask how we can help.

What growth opportunities and untapped potential exist in your business?

Beyond current performance, buyers are looking for clear ways to scale the business, such as:

Clear gaps in the market: responses to customer challenges and pain points that may emerge from your research.

New untapped markets: look at market trends your competitors might already be exploiting and get yourself a piece of the pie. Expanding into overseas markets may also generate higher demand and profit.

New product lines: think complementary products and services, add-ons, upgrades and diversification to spread risk.

Digital upgrades: in software and systems may improve flexibility and responsiveness, and generate higher return on investment.

Subscription models: highly valued by buyers, avenues to generate regular income are sought after on the business sales market.

How can I showcase future growth possibilities to potential buyers?

When you sell a residential or commercial property, one sure-fire way to increase its market value is to apply for planning permission to extend. There are several ways you can highlight potential business growth to buyers in a similar way.

Even if, under current ownership, you have no plans to pursue growth, identifying viable expansion paths and creating plans to highlight the business’s potential may justify a higher asking price.

Having determined the areas where a new owner may seek to scale the business, create a strategy documenting your ideas, research and potential for growth. Include agreements in principle with significant customers or suppliers, and evidence of predicted return on investment. Hand this to interested buyers to create interest, impress and excite them about the possibility of owning a company with scalable prospects.

Three steps to a profitable business valuation

To add value your business and achieve the most profitable sale price, follow our three steps:

1. Do your research to show you understand your market and customer base.
2. Create a strategy to highlight future growth opportunities to buyers.

Consult a Business Partnership broker to explore and identify untapped potential buyers find attractive. Complete our contact form to arrange a conversation.