This Is Why Your Business Isn’t Scaling
How To Handle Business Expansion
Every entrepreneur wants their business to grow. They want to find the largest viable market and sell, sell, sell. However, while growth is inevitable if you take proper care of your business, scaling isn’t so easy.
But before we go any further, let me define growth and scaling in business
Growth, in simple terms, is an increase in business revenue that is directly proportional to an increase in resources, I.e. people, capital, technology etc. Scaling, on the other hand, is rapid growth and if done perfectly, this growth will not attract a substantial increase in resources.
Every business must grow. If your business is not growing then it is dying. So, in essence, scaling is how a business grows.
Why Do You Want To Grow Or Scale Your Business?
There are many reasons why entrepreneurs want to scale their businesses and oftentimes, they have the wrong reasons for doing so.
Basing your need to scale on a faulty ideology may not only lead to a failed attempt at scaling, but may lead to the death of your business.
Some of these misleading reasons are:
The Me Too Mentality:
Do not scale because other businesses are scaling. Scaling requires capacity and capability. It should never be rushed into.
If you are scaling so that your business can look cool, without considering the current state of business, or your business’ lifecycle, etc. then you are just a step away from destroying your business. The last time I checked, “coolness” was not an important factor for making business decisions.
The Workaholic Mentality
You are not less hardworking because your business is not scaling. Entrepreneurship is not a competition. You don’t have to run your business on overdrive so that you can scale faster.
Building a business is hard, and working under sustained pressure would not help you become a better entrepreneur. In fact, stress can lead you to make bad decisions along the way.
Take time to breathe and allow your business to do the same. It is only when things are stable that you can observe if your business is capable of scaling in its current condition.
Questions To Ask When Pushing For Growth Or Scale In Business.
Quality Maintenance.
As amazing as it is to scale your business needs to be able to handle the increase in output without interruptions.
You need to ascertain if you have enough staff, processes and resources to handle the surge that you would be experiencing after scaling. If there would be a perceptible drop in the quality of your product or service then your business is not ready to scale.
Is The Expansion Really Going To Be Profitable?
You need to have your facts and figures figured out. Things like sales projections, market research and forecast, can go a long way to seeing if your business would be able to scale profitably.
If these checks are not carried out, chances are that your attempt at scaling your business would at best be a waste of resources.
There is nothing worse than sinking a lot of resources into a project that was never going to be viable. Having facts makes sure that you don’t make this mistake.
How Well Can Your Business Scale?
Different businesses would experience different level of success with Scaling up. Analogue businesses would spend more resources to scale than digitally inclined businesses. This is because businesses that are most likely to scale well are those that have a good level of automation embedded in their business processes.
To scale up, you need to evaluate the state of your business, strategize on what to do to increase the sales and productivity of your business, invest in those things that would increase your sales and productivity, ie marketing, resources and technology that would aid in automating your processes.
