How to scale your business
Knowing how to scale your business can be challenging, especially for new entrepreneurs. When we talk about scaling a business, we refer to strategies for growth that would align with your original business vision while managing the impact of growth on your business. This is not easy to do and that is why it must be done as thoughtfully and meticulously as possible.
Knowing how to grow and scale your business are actually two different things, though interrelated. Growing a business would require you to increase revenue, and you’re likely to use more resources for this such as hiring more staff to attend to more customers or trying to win more prospects. Scaling a business, on the other hand, requires you to increase revenue without a substantial increase in costs. This means that you support further growth in your business but in a more sustainable way. In this article, we will be discussing ways to scale your business.
Related: Profitability of a Business- How to measure and improve profit
Scaling a business
Scaling a business means increasing revenue at a faster rate than costs; having the ability to increase revenue and operational demands while maintaining the same costs or even lowering costs. When you scale your business, you are setting the stage to support and enable growth in your company which would require planning, some funding, the right systems, and partners.
Businesses can achieve scaling in a number of ways; from adopting new technologies to growing their team to finding gaps in their operations that can be streamlined. It requires the right strategy, processes, and team to be in place in order to support new customers, products, and services.
Every business leader dream of becoming a success and in order to achieve this, knowing how to scale your business is very important. No matter the size of your business, understanding what it means to scale and identifying the actionable steps you can take to scale your business is both crucial to reaching your goals.
See also: Why email marketing is important for small business
Steps on how to scale your business
- Improve your business operations and processes
- Network and expand partnerships
- Invest in technology
- Perfect your products or service
- Implement better strategies to increase sales
Assess the current system of your business
The right system can help your business achieve its goals. When running a business, using the right system creates a process that allows business activities, such as invoicing, operations, and marketing to run in a structured and organized manner. Therefore, in order to know when to implement a system that is successful and sustainable, you will need to assess your current system.
There are various indicators that can be used to assess your current system, such as sales conversions, profit margins, expenses, etc. These assessments can help you plan better to reach your goals. You can create a more realistic plan for your business by predicting your business growth, from assessing its sales figures, new customers, and the income you generate every month.
Therefore, when scaling your business, it is always important to assess your current system to ensure it is aligning with your business’s mission and core values. This will enable you to create a solid foundation for your business.
Set definitive goals
Also, ensure your goals are measurable; they should include specific numbers e.g increasing your sales by 20% or $2000. Your set goals should also be achievable and within the scope of your industry. They should be realistic enough in the sense that you have enough money or sufficient human resources to achieve them. Businesses that scale effectively strike the right balance between setting reasonable, yet challenging goals.
When goals are not clear or realistic, they might demotivate your team members, which can have a negative impact on your ability to scale your business. Most importantly, it’s not just about setting goals when scaling a business, your goals should be time-bound. That is, you should create a reasonable deadline for your goals. You can try splitting them into short-term and long-term goals for feasibility.
Grow your team
Hence, developing a management team that is flexible and can grow with the company is a vital component when it comes to learning how to scale your business. Scaling means your team will have to handle more tasks because the number of your clients will increase. Hence, you would have to think about how many people you may need to hire. Also, you would have to hire only the best talent with leadership skills that are ready for the rapid growth of your business.
In most cases, you may not necessarily need to hire more people. You may rather need to help the already existing team adjust to the workflow. Employees tend to be loyal to companies whose values and purpose align with their own in a way that they feel their careers have a higher purpose. Hence, it is very important to create the right environment and company culture where your team would desire to excel.
For instance, giving positive feedback or rewarding your employees for great results will make them feel more appreciated and work harder. Loyal employees tend to spread the word and pass their enthusiasm for your company on to those they serve and once you’ve built a strong team, you would be able to have enough trust in them.
Trusting your team helps you delegate important tasks easily without micromanaging your employees. The fact is, even when you’re not there your business has to be able to run itself and thrive. Therefore, to really learn how to scale your business, you must learn to delegate tasks to those on your team. This will give your employees the confidence to run the business even when you’re not there.
Furthermore, it is important to note that your team is not just about your employees. When scaling a business sustainably, you must also work on developing external relationships with partners, suppliers, and other organizations that will be part of your overall growth. The community that you build around your business can bolster your foundation so that you have even more leverage and strength as you grow. Hence, take your time to really build the team that will propel you into the future.
Prioritize your customers
Your customers are the reason you started your business in the first place and so you should focus on prioritizing them. Try building relationships with your clients for a better understanding of what they need. This will enable you to have an understanding of what products and services you should develop. You should focus on improving user experience and providing good service. For instance, offering 24/7 support services helps resolve clients’ problems faster. This will enable you to have more potential customers and increase repeatable sales.
You can improve your customers’ satisfaction and achieve loyalty by using a referral program to help you generate new leads and increase sales. Through the program, your loyal consumers can receive various rewards such as discounts and free products. Also, you can compete with other businesses to get more clients by offering various promotions.
In addition, it is important to connect with your customers. Creating raving fans of your product or service is important for your business to thrive amid the fluctuation of ever-changing consumer preferences. When you are scaling a business, you are in a period where there’s room to test various marketing strategies that will build and maintain client relationships. It is the time to build and establish client-centered practices in every facet of your business.
Improve your business operations and processes
You should develop strong operations management that will help you care for products, services, and people. While improving your processes and operations, bear in mind that some of the systems and processes that work during the early years of your business may not work on a massive scale. This is where flexibility and adaptability come in, as you may need to tweak processes as you grow.
In addition, you can also ask your employees to share how they would improve your business operations. This will make them feel more valuable and help you successfully scale your business.
Network and expand partnerships
Scaling a business is not a solitary task; the more people you have on your side, the more successful your business will be. You must develop and cultivate a vast network by joining an industry-related group that offers continuing education and connections to other professionals or by attending regular business networking functions in your city.
When learning how to scale your business, it is important that you get involved in personal or business coaching, and reach out to people that have been in business longer than you to see if they are willing to connect and possibly become your mentor. You can also expand partnerships to increase your brand awareness. For instance, McDonald’s and Coca-Cola have successfully used a partnership strategy to expand their market since 1955 to add value for their consumers by offering innovative meals and designing new packaging for drinks.
However, before you start a partnership, it is crucial to know your partner’s values and goals. Some businesses focus on profits, while others prioritize customer satisfaction. If you partner with a business that does not share the same goal as your business, you might not reach long-term success due to the clash of values. Also, prioritize which companies are suitable for your business. You can partner with a company that serves the same core buyers as you do. For instance, a web design service provider could partner with a website builder company that can offer their designed templates.
Invest in technology
Automating manual tasks is important to scaling a business because it helps you drive improved business outcomes among the team members you already have on board. Hence one of the ways to scale your business is to consider investing in technology that helps automate tasks and processes like team member onboarding, customer relationship management, project management, appointment scheduling, accounting and payroll, etc.
When considering scaling your business through automation, compare different technology partners and vendors based on customer service, usability, implementation timeline, cost, and other key criteria. Also, apart from automating tasks, standardizing your business processes using technology will make the scaling process much smoother. Implementing approved technology and documenting a clear set of instructions for specific tasks will give more efficient results for the growth of your business.
Perfect your products or service
Many business owners just focus on massive growth and forget to ensure that their product or service is solid. They usually figure that they will just fix it after getting more users or more distribution. However, this is a wrong strategy. If you don’t work on the imperfections and try to fix them on time, they will only pose an issue when scaling the business. This is why learning how to scale your business before pursuing growth will save you a lot of stress and money in the long run.
Perfecting your product or service is key. The early years of your business are the best time to listen to feedback, find issues, and improve your products or service until they meet your customers’ expectations. Focusing on creating a product or service that is of excellent quality helps you assume more control when scaling your business because you tend to have a better understanding of what you and your customers want your product or service to be.
Implement better strategies to increase sales
It is estimated that getting a new customer can cost you six to seven times more than keeping and engaging the customers you already have. Therefore, in order to scale your business, you need to think of ways to increase sales while maximizing profit and minimizing additional resources.
There are various practices you can implement in order to increase sales such as zoning in on a target market, understanding your customer behavior, addressing customer feedback, building a team of skilled sales representatives, developing an effective marketing plan, and managing leads and customer relationships with CRM software.
You can also optimize your conversion rates (percentage of your website visitors who took a desirable action to make a purchase). This allows you to increase sales, lower your customer acquisition costs, and acquire more leads. In order to optimize your conversion rate, you can identify your conversion goals and which part you want to improve.
For instance, you can focus on conversion that helps your email marketing performance, such as how many customers subscribe to your email newsletter, and then, make an irresistible offer. This includes creating a clear headline to show your value proposition, using high-quality image products, and keeping a good site performance.
Check out: Why digital marketing is important for small business
Mistakes to avoid when learning how to scale your business
- Having no solid foundation
- Poor hiring
- Adding unnecessary features
- Focusing only on numbers, not quality
- Scaling up too fast
Knowing how to scale a business can be exciting for you as a business owner, but the fact is, you are most likely to come across several unexpected challenges. Here are some of the most common mistakes that you need to avoid when learning how to grow and scale your business:
Having no solid foundation
Before scaling your business, it is important to ensure that your business already has a mission, vision, culture, and goals. This is very crucial because when you already have these elements in place, you can successfully implement a strategy, manage cash flow, and optimize the workflow because you have what you aim to achieve in mind.
Poor hiring
Scaling your business may require you to get new hands on board to help your business run smoothly. However, you need to be meticulous about this and ensure you hire the right and talented employees that will follow the company’s vision and mission.
Adding unnecessary features
Many businesses try to add new features as their business grows without considering what consumers want. This can be detrimental to their business as it makes them less focused on customers. You should try as much as possible to avoid this when scaling your business. Only add features that you are sure will give your customers a better experience.
Focusing only on numbers, not quality
The majority of businesses aim to decrease costs and gain more leads, regardless of service quality or customer satisfaction. They tend to focus on profit rather than customer satisfaction. This is a very wrong approach to scaling a business. You should prioritize your customers in order to help you attract valuable buyers. Hence, when scaling your business avoid focusing only on your sales figure.
Scaling up too fast
Seeing your profit grow can be really exciting, but that doesn’t mean you need to scale your business without further consideration. Before scaling your business, you need to be sure that you can still keep your consumers satisfied while cost-cutting and increasing sales.
