Scale: “To grow or expand in a proportional and usually profitable way”
Is your business scalable? This is a popular topic for business owners interested in expanding their brand. Even if your business is still growing or currently unprofitable, there’s still a chance for exponential potential. Businesses that are able to successfully scale have a few things in common that contribute to their success. If you can add significantly more customers without increasing your costs proportionally, then the business is “scalable” and becomes more and more profitable as it grows.
So how is it that some businesses are able to scale and others aren’t? Here are a few things to consider when determining how to successfully scale your business.
How Do You Know if Your Business Is Scalable?
“You have to have customers. You have to have revenue. You have to have a data point that shows why if you take one dollar you are going to return ten dollars.” – Suneera Madhani CEO/ Founder Stax
There are multiple factors to consider to determine whether or not your business model has the potential to scale. Successful business growth depends on a scalable business model that will increase profits over time, by growing revenue and avoiding cost increases. Most businesses fall into one of three categories: brick-and-mortar businesses, online businesses, and service providers. Expenses required to properly scale depend on your business type.
According to the U.S. Small Business Administration, most microbusinesses cost around $3,000 to start, while most home-based franchises cost $2,000 to $5,000. So how do you estimate your hard costs to scale your business? Here is a generalized list of common expenses you’ll accrue in order to scale pending on your business type. Make sure to add any other additional expenses that are unique to your business. If financing is an issue, finding investors to fill in the gaps is a solid solution.
- Office space
- Equipment and supplies
- Licenses and permits
- Employee salaries
- Advertising and marketing
- Market research
- Printed marketing materials
- Website Updates and Optimizations
Take Stock of Your Business
As your company continues to grow, take stock of where your business is now and its potential to scale. This is vital for exponential growth. So where do you start? Data. The more data you have, the better equipped you are to make changes when necessary. This gives you the opportunity to either fix what’s broken or improve what’s working.
You can’t manage what you can’t measure. In other words, you can’t know what to do differently unless you analyze where your business stands today. Is your business surpassing previous goals? A strong cash flow due to consistent sales with proven concepts and reliable infrastructure alongside minimal risk is a good sign that your business is ready to scale.
Solidify Your Sales Structure
Having a sales structure in place to generate more revenue is essential to support your growth. A sufficient number of leads include the implementation of marketing systems to track and manage leads. A robust system to manage sales orders, and enough sales representatives to follow up and close leads is also necessary for success. A billing system with a receivables function to follow up will ensure that invoices are collected in a timely manner.
By now you should be able to identify your ideal customer. Understanding the needs of your ideal customer, select a repeatable, profitable, and scalable way to sell to them. This will allow you to design an optimal sales funnel.
Find and Implement the Right Tech
Once you’ve pulled together the right data, pinpoint areas you can reduce risk, and solidified your sales structure it’s time to assess your tech. Carrying out necessary technology upgrades and using the right tools is an essential part of successfully scaling your business. Certain products and tools such as a website upgrade, customer management system, new landing pages, etc is a solid first step to business growth.
It is possible you might be ahead of the curve and have an individual or team in-house who can immediately address important upgrades. For example, a web developer who can immediately address your website upgrades. If not, it might be a smarter decision to invest in services from an external team. Other companies have dedicated time, experience, and expertise that your team members might not have for certain tasks. This can also help with speeding up the process, as well as freeing up the time for your team to focus on more immediate needs.
Hire the Right People
Having a solid team behind you is an important part of helping your business scale and grow successfully. Look at industry best practices for the overall functionality of your business and determine how many customers one service rep can handle. Don’t assume that more salespeople hired will equate more sales made. You want to find employees that will fit in with your company’s culture.
Don’t forget management. As your business scales, you will find you are no longer able to personally oversee every aspect of the business. Having the ability to confidently delegate responsibilities to different department leads will allow you to focus on big picture items that will help move the needle and support business growth. As your business grows, the management bench grows as well.
How Stax Payment Processing Can Help Your Business Grow at Scale.
More payments mean more revenue. The real differentiator to be considered as you begin to strategically scale your business is how you can make payments processing part of your revenue strategy. The way your business processes payments will help fuel revenue growth.
Stax’ leading technology, award-winning customer support, and money-saving subscription model work hand in hand with the needs of your business today to ensure you get paid faster.