How can I recognize a growth opportunity?

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Opinions expressed by Entrepreneur contributors are their own.
I can think of four ways to spot a growth opportunity. I'm sure there are others more specific to your product or service, but these are some questions to ask yourself:

1. Can you reach more of your ideal customers? This might require you to rethink your marketing plan a little. Perhaps switching from more traditional marketing to marketing your services on the web. Are you marketing yourself online via a blog? Some of your customers may be using Facebook or Twitter. Some of your potential customers may have formed online communities all to themselves.

2. Can your product be used by a different customer, or in a new way? For instance, Gatorade markets itself to the dehydrated athlete. It has done a very nice job exploiting that niche. However, an intoxicated college student will tell you that drinking 32 oz. of Gatorade before going to bed will prevent a hangover. The intoxicated frat guy is a new market for Gatorade to serve, and grow, if it so chooses.

3. What are some of the current trends that are affecting your industry? With the current financial crisis, businesses and consumers are looking for ways to save money/reduce costs. Can you provide a product or service that will help them with this? In general, some other current trends are: more people are using mobile applications to conduct business, more people are on the web, more employers are allowing their employees to work from home, people are spending less time watching television, more businesses and consumers are becoming aware of their environmental footprint. Can you develop a product or service that can exploit these trends?

4. Are there new laws, bills or mandates from the federal or state government that can affect your business? For instance, when President Obama spoke to the nation a few weeks ago regarding the budget, he put a large emphasis on education, energy, and healthcare. All three of which will become growth industries in the very near future.

Personally, I think it is always a good time to be looking for opportunities to grow your business.

What is the best way to go about exploiting a growth opportunity? This might be left up to personal discretion. Some entrepreneurs will tell you that if you see a growth opportunity that you should risk it all and jump in with both feet. However, I am more prone to be cautious. I'd much rather approach the opportunity slowly, investing more time than money and make sure that it is a solid direction to take the business. The downfall is that I might lose sales and will have to work hard to catch up to those who jumped in with both feet. But if I fail, or it wasn't a real opportunity, then I haven't lost everything.
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