How big is big enough? How big is too big? These are questions every small business owner must face at some point in their entrepreneurial journey. Once you determine your target for growth, you need to set your sights on how you will get there. Follow these six steps to scale your business to its maximum potential.
Make a plan
Before scaling your business, you need to make a plan. This can then be used to guide your scaling.
Key elements to consider are:
- Product and pricing: what are you going to sell to customers, for how much, and how will you differentiate from your competitors?
- Marketing: what channels will you use to acquire customers and at what scale?
- Operations & logistics: operationally how are you going to do “1” and “2”, what are the processes and people required to be able to deliver this to your customers?
- Financials & cash flow planning: what quantities will you be able to achieve from the above, how much will it cost, and how do you ensure you have sufficient funding to deliver at this scale?
Focus on what has the potential to turn the dial
If you’re looking to 5x the size of your business, then look for things that can actually do that and focus on them.
One of the common pitfalls for an ambitious owner is that they try to do too many things at once. As a small business you’re likely time and resource constrained and so it is vital that you spend time on the most important and impactful things. Effective prioritisation is crucial to success.
Always challenge yourself whether the thing you’re working on will actually help you achieve your goal either directly, (e.g. because without cracking a new marketing channel you’re unable to scale) or indirectly (e.g. you can’t scale unless you have sufficient cash to pay for the increased marketing spend).
Test and learn quickly
One advantage you have over bigger businesses is your ability to be flexible and agile in both your business model and your tactics. Test things as quickly as possible, learn and iterate.
Once you’ve determined your most impactful focus areas, lean into them. Hard. It’s great to have a plan, but in order to succeed you need to actually “do”. And often the reality of how things perform are very different from our expectations. But that’s ok - that’s all part of the process.
When a test works, lean in
Business advice books talk endlessly about “failing fast and forward” but perhaps less often mentioned is really leaning in when you find success.
If you have a test that works it’s important to act and actually lean into that test to scale it up. Without actually expanding on the things that are proven to work, you’re never going to have transformative impact.
Delegate and empower
As you scale, businesses become more complex and you will no longer be able to do everything yourself. Empowering people around you to step up and take ownership of areas of the business is crucial for success.
While it sounds like a no-brainer to get help with your business, letting go is hard for a lot of business owners. It is your baby, after all! Investing the time and effort to hire great people you can trust will make this process much easier.
Always think about cash
Scaling a business will typically soak up cash - as your marketing pounds typically leave the business before cash from the customers you acquire from that marketing comes in. Additionally scaling may require capital expenditure and hiring, which all use up cash.
Planning and managing your cash flow will ensure that you can continue to successfully operate as a business. You can look at a wide range of possible funding sources to improve your business’s liquidity - including the Capital on Tap Business Credit Card. This line of credit will give you up to 56 days interest free and uncapped 1% cashback on all card spend, both of which should help to relieve pressure on your cash flows.