5 things you need to know before scaling your business
Scaling your business is exciting. If all goes well, your team, customer base and revenue will grow. If done badly, you can end up with stressed out staff, a crisis of responsibility, and a lot of admin. Here are five things you should think about before scaling up.
Know your business
An analysis of your company and market is essential groundwork if you’re planning to scale it. Do you have a proven business model? Is there increased demand for your product or service? Can you fill your company’s skill gaps? If you’re taking on debt or investment, have you planned how you’ll spend it? The answers to these questions should underpin your strategy.
Prep your team (and yourself)
Once you’ve decided to scale up, it’s time to prepare yourself.
“Scaling your company quickly will multiply the intensity overnight,” explains entrepreneur and investor Eddie Holmes.
“The impact of your decisions will increase exponentially, and there’ll be new pressure coming from customers, staff and investors. You need be ready for the extra responsibility.”
Anticipate the added demand on your team by recruiting before you start ramping up operations. Most SME owners who have experienced the hiring process will tell you how time-consuming it is to find the right people, making it imperative that you start recruiting early.
Be realistic about managing the extra workload
Adding high energy and fast growth into your company’s DNA is great – as long as it doesn’t negatively affect your team. Pressure to bring in business and to turn client work around quickly can breed a very high-pressure environment, and even result in burnout.
“I worked for a company that was growing rapidly,” says Victor, an online marketer. “Our number of users doubled, but our team stayed the same size. After six months of working 12 hour days, a third of us resigned.”
“If management had been more flexible about making the necessary hires, I don’t think it would have worked out like it did,” he adds.
Spring clean your back office
To an all-guns-blazing entrepreneur, back office ops are about as exciting as laundry day. But without a robust back office, a scaling business runs the risk of meeting very real teething problems.
Making sure that accounting, HR, payroll and bookkeeping are in check will prevent your company from being held back by admin, and allows you and your managers to invest their time and expertise where it matters. If you don’t have the budget for an in-house back office team, software like Xero and Wave can help fill the gap.
It’s not all or nothing
Scaling doesn’t have to be a fast and hard game of all or nothing. Many entrepreneurs and business owners choose to pace it: scaling in tandem with the growth of their customer and client bases.
“I’m going for the ‘slow and steady’ approach,” explains Matt Goolding, a director of a digital marketing collective.
“By making sure I only take on projects I have immediate capacity for, and by not taking on debt or investment, I’m minimising risk in the early, uncertain days of the business.”
Matt highlights working remotely as a potential boon to small business owners. “Remote working might not be feasible for all companies, but if it works for you, it can allow you to grow your team without increasing overheads like office space,” he says.
Ultimately, like entrepreneurship, scaling is about calculated risk and – less sexily – preparation. Spring clean your back office ops, get your team ready, and perhaps most importantly, prepare yourself. World domination starts here.