What Does Scaling Mean
To learn what scaling is, let’s first look at what business growth is and how it differs from scaling. Growth is when a business increases their revenue as a result of adding more resources such as people and technology. For example, you hire 3 more people to build your products and as a result your business makes more money because of the increase in production. Revenue is dependent on and limited by the amount of resources and does not necessarily guarantee an increase in profit. All businesses are capable of growth.
A scalable business can exponentially grow without limits and without an increase in resources. To scale your business, you utilize and leverage systems, processes and automation in such a way where there is an infinite return on investment (instead of just getting paid once). When starting out with any new business it’s important not only to think about what will make money now but also how much time each task requires – because if they take too long then scaling may become impossible! It’s important to build now for the future. If you don’t, you may find that it takes a lot more work if you wait until you really need the automation.
To put things into perspective, below are types of businesses that are easily scalable, and ones that aren’t. Don’t fret if your business falls into the latter category though, because there are aspects of every type of business that can be automated, which makes them more scalable.
Business Types That are Ideal for Scaling
Memberships and subscriptions are ideal for scaling. Think about gym memberships and magazine subscriptions. Not only are there no limits to how many people can join (infinite growth), this type of business focuses more on repeat revenue. All business owners should know that the cost of selling something to a repeat customer is drastically cheaper than the cost of acquiring new customers.
Businesses that are automated definitely fall into this category. Think of car washes and laundromats. An infinite number of people can utilize these services and they do not require your time or energy to run them. These machines collect the money and do they work through automation. Yes, maintenance and other tasks still require human intervention, but look at how much time they save you by doing the majority of the work.
Web-based Content is another excellent example of a scalable business. This could be anything from a podcast to video games to courses on YouTube, Udemy, etc. There is the initial cost and time of creating the content, but after that you can sell it to as many people as you can.
Businesses Not Ideal for Scaling
At the top of this list is 1:1 Coaching or Consulting. Consulting is outright selling your time which means there is a limit to how many people who can purchase. However, you can automate parts of your business such as your calendar, how people purchase and book appointments with you, follow-up and reminders.
Next is custom work. For example, if you are selling custom websites, there is a finite amount of time for you to build and you also rely on others who may not value your time for the content. This is very time-consuming and limits the amount of customers you can have at a time. This also has the disadvantage of you being in the vicious cycle of sell, build and sell again. However, if you build website templates and then sell those, then you can scale.
Scaling a business means finding ways to apply your time and money that are scalable. To scale an idea, you need two things: the potential for infinite growth (i e., something with no upper bound on how much it can make),
and then some resource outside of our own efforts which will provide more output as we use less of it such as advertising dollars or employees working full-time instead of just part time.
If you fall into the not innately scalable business category, our platform is designed to help your business become scalable by automating as much as possible and for far less money than our competitors. After years of hearing clients complain about how they were sold something and were never provided any follow up or training, we built our own system. And, we not only give you the system, tools and technology, we also give you the training and strategy as well as other resources. After 6 months, you will be measurably farther ahead in your business than if you stayed on your current course.
If you want to scale your business, start by automating the tasks that take up a lot of your time. By doing this, you free yourself up to work on bigger and better things – like scaling your business! Systems, processes and automation are essential when it comes to scalability, so don’t be afraid to invest in them. Are there any specific tasks that you could automate right now to help with scaling?
If interested, check out this link to our own platform, Automation on a Mission.