2 percent is only good for milk — Think beyond that to boost the company bottom line

It seems lately that we’re in an era of 2 percent everything — 2 percent milk, the 2 percent rule, a sluggish growth of about 2 percent. Nothing is growing fast right now, which is keeping interest rates at historic lows but is also creating a challenging environment for growth-minded captains.

To use a sailing metaphor, a boat and rigging might be in perfect order but it’s awfully hard to go fast with no tailwind. If your company is facing the macroeconomic doldrums like so many others, maybe it’s time to put on an outboard motor to speed up growth — something that won’t happen if you simply spend your time in your quarters bemoaning your conditions.

At our private equity firm, The Riverside Co., we’ve acquired more than 400 companies over the years in a variety of industries and geographies. Generating sustainable is our highest priority. We’ve honed that approach over nearly 30 years that have included some protracted economic slumps. It can feel impossible in low-growth times like these, but here are three ways Riverside stokes the growth engine in good times and bad.

Pricing

If you haven’t thought about your prices lately, chances are that you’re missing out on revenue with a near 100 percent margin opportunity.

I’m continually surprised at the gaps we discover during due diligence. Carefully analyzing your pricing history and ensuring that you’re getting the correct value for your products and services is often a near-term way to boost your bottom line.

In one dramatic case, a software company we acquired was charging $60,000 for a new product, and after calculating the value it delivered, we determined the company could raise the price to $400,000 without an impact on sales volumes.

Even if you fear the results of a price increase, you can still stop “leaks” in your pricing caused by unnecessary discounts — that alone can add a 2 percent boost on average.

Sales tune-up

We take great pains to understand the sales process and then write a playbook at our companies. We build a formal sales process based on an evaluation of sales techniques, current and prospective customers and the pipeline that is rigorously monitored.

Be sure you’re dedicating your sales resources to the right places and clearly communicating a compelling value proposition. Less focus on the most competitive or unrewarding customers frees up resources for new, higher-yielding campaigns.

Accretive acquisitions

Competitors may also be suffering slow growth, making this a great time to acquire a competitor or two. This can add scale and provide opportunities for synergies for both companies.

Growth is rewarding in multiple ways. After selling almost 120 companies, Riverside knows that winning investments generally have a sales chart that looks like a ruler placed at an angle up and to the right — steady growth every year no matter what the broader economy does.

Now is the time to stop blaming a sluggish macroenvironment and take matters into your own hands.

Stewart Kohl is co-CEO of The Riverside Co., a global private equity firm based in Cleveland. He is an Oberlin College trustee; co-chair of the board of trustees of the Museum of Contemporary Art Cleveland; a trustee of the Cleveland Clinic as well as a member of its Wellness Institute Leadership Board and co-chair of the Cleveland Clinic Capital Campaign. Visit www.riversidecompany.com.