It’s the goal of any small organisation—business is booming. Your customers are singing your praises and your profit downline is even happier. You can feel there’s potential hot leads in the distance, an everything inside you is screaming to “scale up.” The next step? Hiring a few shark like sales people to generate those leads fast?
For small organisations, bigger may look more exciting—but that isn’t always true. expanding your business and hotshot team may equal increased profit margins, but this also means increased hiring and operating costs. Success is learning how to scale—and how to maintain that scale more and more with every sale.
What’s involved with scaling your business
“Scaling a business” is defined by the ability to accrue larger amounts of profit whilst maintaining efficiency and resilience. Quite simply, this means you should earn more than what you spend in time and money to get every customer onboarded and nurtured. Whether your your considering opening a new location, hiring a team when you’ve been running things alone, or developing a new product, the secret to successful growth isn’t just about scaling. It’s about the secret sauce of any successful business: more money in, less money out.
How to begin scaling your business
Evaluate strengths and weaknesses
Successful small businesses are by nature, hardy and resilient. For the 80 percent of small businesses that make it to their second year, only 44 percent of small businesses survive to year four.
Growing to scale in many cases can be the straw that breaks the camels back. It’s not something that can be rushed or risked, it takes planning and timing to get right. Look at every variable through a microscope: your people, your structure, processes, products, offered services, human resources planning, and most importantly budget.
If there are any chinks in the chain of your business today, scaling means those weakness grow too. Set aside the time to analyse your business from the ground up to make sure you can truly support sudden growth. You cant scale your business without it running like a Rolls Royce engine.
Build a strategic roadmap
After you’ve evaluated every nook and cranny of your business, it’s time to start building a roadmap for scaling. Like any other strategic roadmap, it should identify which milestones you hope to accomplish, by when, and how each key area of your business is expected to contribute.
Always make sure your scaling roadmap sets the path for every decision you make. If a new target doesn’t tie in with your growth milestones it can cause a knock on effect and plateau you fast, the key here is don’t spend money just because you can. Every decision you make in your scaling strategy should be built with long term growth in mind. Always check to see if revenue growth is on track, keeping outgoing costs to a minimum, and teams are hitting key initiatives.
Keep your house in order
You have to have money to make money. But what’s the difference between simple growth and scaling fast and intelligently. Scaling is a risky but well thought out strategy that has the biggest long term return. Is there enough hunger in the market to warrant scaling now? Will you be able to generate leads without increasing outgoings? Can you afford hiring the new talent needed to maintain your scaling roadmap ?
Most businesses that fail do so due to revenue problems not enough money in too much money out. To scale successfully you need investment. If you can prove you can scale and provide a decent ROI investors wont think twice about being on board. You can also consider loans and lending to achieve a sizable investment in your business, with balancing debt with revenue you can make a tidy profit whilst scaling fast.
Make sure you have the right tools to scale
Your business infrastructure is built upon the processes and people that keep business moving forward. You might not even fully see the infrastructure you’ve already built up—which often means its working for you not against you. However once you scale it becomes more critical to analyse and understand this infrastructure.
When you scale successfully all of the moving parts of your business should work together in harmony. The tools available to you should help every part of the business flow—all the way to the final invoice payment.
How do you know if you’re ready for scaling? Start with your people. Do some HR planning to see if people are in the right roles, or hire new people to fill the skills gap. Look at your current tools and analyse how they help towards your future growth, or if they’re slowing people down. Then break down the running processes of your business. Is your payment processor getting in the way of people paying with ease? Your systems may work for 100 people, but what about 1,000 or 10,000? The same is true for outstanding invoices, what’s your process for collecting late payments ? What if 10 customers choose not to pay ?
Your processes keep your business running even when you’re away everything should tick over smoothly. If you’re still having to jump in and help out then you must analyse why and fix it before it becomes a full time problem.
Keep customers happy
Cutting corners and getting sales faster can be very tempting but will sabotage your growth strategy. Your customers are the key to your growth. It doesn’t matter if you have the best product people will remember your customer service and process more than your USP. The most valuable resource you have as a business is repeat customers, keep them keen.
80% of your future profits will come from 20% of your current customers. These customers are likely to invest more, cost less, and will make the most word of mouth marketing happen. They’re like your mascots—they are a big source of free advertising so keeping them happy is key. In this case its quality over quantity. Ensure that your customers who took you to the top still feel part of the family, and not tossed to the side when you grow.
Automating anything internally and outsource the rest
Automation saves so much time and frees up resources to focus on more important tasks removing manual tasks can help relieve stress and effort. Employee scheduling, invoicing, client onboarding, responding to contact etc. can be fully automated to shift workforce focus to business critical tasks, without sacrificing customer relationships.
If you can’t automate it, outsource it. Your team may not be design gurus or know everything about SEO, buts to do these roles in house. Instead look to freelancing sites they are a source of top talent for a fraction of the cost, quids in. You’ll be able to call up these people on an ad-hoc basis saving time and money.
More business does not equate to more employees, the contrary is true.
Pushing for more and more isn’t the way to be successful. Amazon started in a garage. Staying light keeps expenditure down and profits up—be resourceful, do more with less. Keep costs down and only hire who you need to, keep workload moving forward, and always listen to customers input.
Look after your team
Staying light doesn’t mean running yourself into the ground. When your business starts to scale, it can make things look and feel unstable for everyone. Keep your top talent on board by checking in on them frequently and attend to their needs. Recognize them for their hard work that they put in to keep your business moving.
Scaling means peoples roles grow and change, moving people into new areas of the business to help them grow with you. Including them in your strategic roadmap can help you discover new skillsets that they hold and put them to use. Giving them a sense of ownership really increases the buy in from employees they want to help be part of something bigger, let it grow, let it grow !