We hear the word, “scale” thrown around a lot in business, particularly online when they say you need to scale your business.
According to The Startup Finance it means: “Make more revenue faster than it takes on costs.”
Using that definition, you want to start scaling as soon as possible. That is how you can become more profitable because you will have more income at a ratio to lower costs.
That is actually always a good place to be in business. Here are a few tips you can start using now if you want to start scaling your business.
1. You can create very low overhead products these days.
One way to add revenue with minimal costs is to create a digital course or product that can be sold online.
Another popular low overhead service is online memberships. By adding revenue, and not adding costs to produce each item, this can help to scale your business quickly. You are serving more people without taking on more costs.
2. You can create multiple reasons to buy from you with multiple offers.
Again, without increasing costs you can create a new offer that can be resold to your existing audience. Or perhaps an existing offer can be repackaged for gifts. Or maybe you can add a fun bonus to an offer and give your audience a new chance to buy from you. You are serving your same people again without taking on more costs.
3. You can keep the costs low by minimizing debt.
Small businesses and start-ups can begin to scale more quickly if they keep business debt very low, or if possible, non-existent.
Using my Breakthrough number approach, everything above the business four walls is profit, and from that amount we must pay debt. Without debt you have more revenue and more money going into those profit parking lots.
4. Scaling can cause short term bottlenecks to push through.
This is one side effect we don’t talk about but, as you are generating more and more revenue, if your systems aren’t in place, it may cause a bottleneck where you can’t generate more or serve more without more money for systems.
It happens and a way to minimize this risk is to have some support in place as a temporary or project-based cost until you get to the next income level. You cannot scale all by yourself. You need support.
5. Always watch your pricing.
Increasing revenue without being aware of any potential profit leaks can defeat some of your scaling efforts.
Generating income at a faster rate than you take on expenses is a beautiful thing! Keep your eyes on the profit margins as your business expands.
Remember that every line of business should be profitable, but they don’t all have to be equally profitable.
Need to get your Breakthrough number? Join us inside First Steps to Profit to get your finances organized, learn your numbers, protect your business and scale your business. Visit this link for more information: