What does it mean to scale a business?
Scaling a business is when you increase revenue without substantially increasing your overhead or resources. It means learning how to grow your revenue in new ways that don’t put your foundation at risk.
As you built your business, you’ve put so much into designing and delivering your product or service. The formative growth days of any business come at an incredible cost, financially and personally. The cost of equipment and supplies needed to develop your systems are only one side of the story: there’s also the personal sacrifice, in both time and stress.
Maybe you’ve only just now started to get back some time for your life. Is it possible to scale without going back into the trenches?
You can scale your business without it costing you what it took to get here. Here are two ideas for how.
Scale by developing a closely related product
One of the most direct ways to scale is to add to your product or service offerings because people are asking for it.
We see this everywhere. A brand builds a stable foundation making or offering one thing, then customers start suggesting that they make something similar. For example, you’ve started making light-weight adventure backpacks for mountain bikers. You have one store and a strong online presence. You’ve already done the work to create all the systems to make those packs and sell them—and you’re doing well. Then customers start asking for waist packs.
This is an excellent moment to scale. You already have demand, and with your existing resources, you have the manufacturing capability to handle more production. The extra materials would pay for themselves.
If you have a strong prototype for your business, all you have to do is pick up your same systems and adapt them to the waist pack. You’ll have some cost to launch a new product, but largely you are working with all the same materials and systems. You’re doing the same activities with a new product.
Scale by maximizing the use of your resources
What resources are you underutilizing? Do you have an ice company with machines that run more during the day or by season? Or an events space that is mainly booked on the weekends?
Take a look at what you’re already paying for and consider how to squeeze every last bit of potential use out of it.
Say you recently opened a gelato shop, and the machinery was one of the biggest expenses. In order to get the return on the investment from buying this machinery, you need it to work 24/7. But after the first summer—high gelato-eating season—you’ve discovered that you can’t sell enough gelato to run it that often. So half of the time, the machines sit unused.
How could you maximize its use?
Here are a couple of ways:
- Rent out the use of your machine to another company in town like a caterer or restaurant or culinary school.
- Add another product. Do you have the space and customer demand to add frozen yogurt to the menu? You need to change the ingredients, but everything else in your system is going to look the same. You can schedule frozen yogurt production in the morning and gelato production at night, and you get the added benefit of adding to your product base with adding anything to your bottom line. Just make sure beforehand that there’s a desire for it in the market.
Both of these strategies are similar in nature and result, but come from a different starting place. Can you see any ideas for your own business in these two examples?
Scaling is a creative journey that doesn’t have to be painful, but can be if you don’t know where to start. If you’d like help envisioning how to scale your business, a business coach can help you look at your business today and chart a path forward. Schedule a free session with an EMyth Coach to get started.