Do you want to learn how to turn a small business into a big profitable business? If YES, here is a complete guide on how to scale your business and grow fast.
The one thing every entrepreneur thinks of when their businesses have gotten to a certain stage is scaling. As no businessman would want his business to remain a startup forever, so scaling is always inevitable.
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What Does It Mean to Scale a Business?
Scaling a business basically means multiplying your business revenue base while expending minimal cost in the process. Scaling a business often entails increasing your customer base, making more sales, growing your profits and enlarging the popularity of your brand. More than a few entrepreneurs have made the mistake of scaling out of proportion by hiring more employees to service the very few new clients they acquired, thereby adding more costs than revenue to their business.
Staying Small vs Scaling up: Which is the Best?
Entrepreneurs only do things that are bound to benefit their businesses. Scaling on its own comes with a lot of benefits for the business. When you scale your business, you expand the size and scope of the business. Companies can leverage on this size expansion to get better contracts, negotiate exclusive dealings and negotiate favourable terms of contract with other businesses.
Again, scaling enables a company have access to new customers and more market share than it otherwise would. It is an established fact that the dream of every business is to increase sales revenue without increasing output cost; scaling your business would enable you to do just that. Furthermore, scaling can help a business to form partnerships that lead to business expansion and access to international markets.
5 Signs That It is the Right Time to Scale your Small Business?
Sometimes, entrepreneurs can be so presumptuous and assume they know everything about their business regardless of the signs their business keeps throwing at them. Before you decide to scale up your business fast, you need to consider if your business is ready. These are the various signs you need to look out for.
a. Client Rejection
When a business is just starting up, it takes on every client that meets its requirements, and soon enough, it gets to increase its client base. But when your business starts rejecting clients based on time constraints or maybe too few employees or dearth of products, then you know it is time for your business to expand to accommodate everyone. Rejecting clients does not bode well for the popularity and expansion of your business.
b. Surpassing Previous Goals: Every business has a goal it has set for itself to make sure the business is doing well in the market. It always gladdens an entrepreneurs heart when his business meets its goal because it shows that the business is doing great in the market. But when a business consistently over shoots its goal every month, then it is a sure sign that the business owner needs to start thinking about moving its boundaries.
c. Reliable Team
Is your team more than efficient? Are they able to take on added responsibilities without stress? Can your company afford to take on more demands without issues? If you answered yes to all these questions, then your business is ready to go to the next level as quickly as possible.
According to various seasoned entrepreneurs, scaling your business before it is ready is a bad business decision because you can end up losing your business entirely. Bearing this in mind, you need to first consider these few factors before you should ever think of quickly scaling up your business.
A Practical Checklist of Factors to Consider Before Scaling your Business
i. Ensure That Every Aspect of your Business Can Support Growth
A lot of business owners make the mistake of thinking that the current state which their business is running on smoothly can support additional customers and increased demand. They fail to factor in the fact that more customers mean more products or services, and more products or services mean more raw materials, and more raw materials mean more employees, more storage facilities, more equipment or updating current ones, more expenses, more technological upgrade, more planning, and the list goes on.
Failure in this aspect of evaluating the capacity of their business is why most businesses fail after scaling, because they didn’t anticipate the volume of change they would encounter and so were swamped by demand. One tip to take note of here is that the easier it is to mass produce your product, the more scalable your business is.
ii. Ensure your Team is Brought Up to Speed
Scaling a business often means increase in demand and stress for the team. Ensure that your staff are on the same page with you in every step. If the employees you have currently may not be able to withstand the business explosion you have planned, then you should make plans to recruit more qualified and experienced staff. In fact, recruiting should be one of the issues to handle earlier on because it can be quite difficult to get the perfect staff to fit into the various roles in your organization. Every entrepreneur can attest to this fact.
iii. Prepare for Training
You need to ensure that you are adequately prepared to train the new staff that are billed to join your team. Example, if you hire people to scale up your marketing department, ensure that they are trained on how to get clients, how to close deals, how much your product goes for and the best ways to make sales.
iv. Consider Cash Flow
One pertinent problem to tackle when you want to scale your business fast is that of cash flow. The amount of cash at hand is paramount when scaling up a business. Without the requisite cash at hand, you would find it very difficult to take on additional business responsibilities. You have to make sure your business is financially sound to keep up with the speedy changes. Without money, scaling is bound to fail as the business would operate by the skin of its teeth.
v. Watch your Business
It is worthy to note that unless your business is flourishing, it may be a bad idea to scale the business. Without you having a good product that people can easily accept, scaling may not do much for your business, and may even stifle it. So you need to ensure that you have a ‘killer’ product or service before you can think of getting more awareness for it.
vi. Consider Business Independence
Here, you need to consider if your business was put together in such a way that it would run on a large scale without your presence. If your business can’t do without a particular employee, then you have to go back to the drawing board. You equally need to consider if there would still be market in the next 5 or 10 years for the products you want to start mass producing.
How to Scale a Business and Grow Big Fast – A Complete Guide
1. Go Big or Go Home
To scale your business fast, you need to start thinking big. It should not end with thinking big as you would need to match the work with the talk. As you are thinking of exponentially increasing your company profits, you need to surround yourself with people that can help you accomplish this feat.
You heard about that prolific marketer that can sell just about anything? Get him. You equally need a business strategist with a towering resume and a long list of accomplishments. Creating the perfect team for your business is a sure fire way to scale your business fast.
2. Build Networks
Business networks and relationships pave a lot of ways in the world of business. You have to know the right people and know the right buttons to push to help you accelerate your business growth. So, if you want to scale your business fast but do not have the right, or should I say, rich and powerful connections; then drop everything else and seek after them. The right connection can take your $5 million business to $20 million in the shortest possible time.
3. Plan Smart
Business scaling comes with complexities, hinders collaboration and slows the team down, but planning smart can help you avoid these pains and keep your business on the right path. You need to be in charge of your ship every step of the way.
You should be able to work in your business and on your business, and let no detail be too small to require your attention. At a time, you may even be required to look into administration and employee welfare to make sure that it doesn’t present an unnecessary loophole for chaos.
4. Put your Money to Work
Business expansion costs a lot of money, that is an established fact. If you are strapped for cash to carry out the necessary changes, then you may as well forget the idea, or you can explore the various financial options available to you. You need money to hire those high-flying employees, add equipment and more machines get new technology, etc.
5. Scale in Part If You Can’t Scale the Whole
You need to consider which aspects of your business that can be automated, or which aspect of your business is quite easy to scale up, and start doing that fast. Sometimes, it is advisable to scale each portion of the business at a time than scaling everything at once. Carrying everything at once may breed problems for the business owner especially if he wants to scale the business in no time.
6. Leverage on Technology: Technology has made it possible to carry out production easily. In order to scale your business quickly, you need to leverage on any and every technology that would make your production process smooth and easy.
This is the right time to expand your publicity strategies. The ones you currently use may not be adequate to cover your now bloated target market, so you need to get new ones, and fast. Alternatively, you can hire the services of a publicity strategist to help you craft better and fitting publicity strategies to enable it reach your new target market.
In conclusion, co-ordinating various teams while managing priorities, resources and metrics in a way that doesn’t slow your company down is no mean feat. Effective management, planning and careful attention to details are what you need to successfully scale your business fast. In all, in order to scale your business in no time, ensure that you know what can attract customers to your business, and then leverage on that knowledge to achieve sustainable business growth.