Do you have a startup that has been launched successfully and seems to be doing well in its intended marketplace?
If so, perhaps it’s time you consider scaling it up. However, you need to understand a couple of things very clearly, like what is your startup’s scalability, and is your startup ready to scale up?
In simple words, startup scalability is the startup’s ability to grow and expand its offerings to a much bigger audience without compromising its delivery performance or revenue generation. In essence, you would be taking on a much bigger workload while all the other parameters governing your startup remain the same.
Identify if Your Business is Ready to Scale Up
Now, you need to identify if your business is really ready to scale up. After a point, your business loses the startup status and attains all the perks that come with a fully functioning business enterprise. One of those perks is the potential to expand and spread your wings. The scaling-up process can be a defining point in your business’s future, and there is a right time to do it.
If you try to scale up too soon, you might jeopardise your startup business’s sustainability before you find a proper footing in your industry. And if you wait around too long to scale up, it might result in losing out on valuable opportunities that could help elevate your business to greater heights.
As the adage goes, “Time and tide wait for no man”, and you do not want to put your startup’s scaling on the back burner for too long.
You also need to identify if you can afford to scale up. If the process is too labour-intensive and interrupts your profit flow, then you need to backtrack and think again. Sometimes, it’s okay to stay a startup for a little longer if it’s the best judgement call for your business in terms of finance. A mean, lean startup machine is always better than a failed SME.
We have put our heads together and compiled four essential tips you need to keep in mind while deciding the future scaling up of your startup business.
Understand the Heart of Your Business to Keep it Beating
You need to have an in-depth understanding of your business before you can start considering scaling up seriously. What is your business all about? What are the core strengths that you can use to gain an edge over your competition? What are the pain points or weaknesses in your business you need to address and rectify for better business performance?
And it doesn’t stop there. If you have more than one product or service, how well are your business products or services currently performing in the marketplace? What are your core offerings or your flagship offerings?
You need to take some time and make an effort to analyse current market trends and consumer needs that are relevant to your business offerings. With consumer trend data, you can predict the market demand for your products and services in the foreseeable future. This will give you a clear insight into whether or not you need to scale up.
If your offerings’ demand is not too high and is already met by your current business model, what is the point of flooding the market with products that exceed the demand? You will only waste precious resources and then create a surplus amount of products that will be hard to get rid of as time wears on.
You will also need to research to identify your key target audiences using consumer data that you have acquired, such as purchase histories and browsing preferences. Once you know your audience, you will recognise the strategies you need to adapt to meet your product offerings’ demands.
Intensive market research coupled with your business and sales targets will help you identify the most viable marketing and sales channels for your products and services. This is yet another important factor that you need to master before you think of scaling up your business, as knowing your sales channels will help give more direction to your expansion blueprints.
What makes your startup stand apart from your competitors? Is it great value for money? A penchant for attention to details? Is it extraordinary customer service that ensures your customers’ loyalty? Or is it the exceptional user experiences that you provide?
Once you understand what makes your customers tick, you can gear up towards scaling in a beneficial direction for both your end-users and your sales targets.
Finally, don’t forget to keep your eye on the big picture. What are your goals as an organisation? Always be mindful of your long-term vision while working on scaling up plans, and make sure that your scalability only enhances your image rather than impeding it.
Think Big, Think Long-Term, and Plan Smart
History shows us that only great visionaries ever made changes that leave an impact on the business world as we know it, so don’t be afraid to dream big and then dream bigger. Let the sky be your limit when drawing up your five-year plan and cover all bases while exploring new avenues of expansion. But be smart about it.
Know exactly where you stand at present to gauge how far you can go and how fast you can do it. This means you need to understand your current strengths and weaknesses and your potential for sustainable scalability. Before you start a race, you first check whether your shoelaces are tied, right? This is because even though you get a small head-start by starting a race without proper preparation, there is always the genuine possibility that you will trip and land flat on your face.
Understand your organisational goals and the timelines you have set to achieve those goals, and align the same so that you don’t move too fast and trip over yourself. This will also help you plan, which can help mitigate any potential risks for your business as you scale up in magnitude.
It will help you see your business as a real-life chess game, with your competitors guiding the opposing pieces on the board. You need to bring your A-game if you want to scale up in the highly competitive business world. Analyse your competition and make sure you are always two or three steps ahead, if not more.
You also need to play to win the long game, not for the petty conquests along the way. This means you must not let yourself get caught up in the excitement of the moment and make rash decisions. Make business decisions only when you are calm and composed to ensure that you do not leave room for regret later.
Optimise, Optimise, Optimise!
Before you scale up your startup, you must optimise everything. And when we say everything, we mean everything – from your team and products and services and budgets to the caffeine levels of your office coffee!
Start with your offerings. Are your customers satisfied with your services? If you scale up, will there be a demand that you can meet? How can you improve your products and services?
If you think there is no room left for improvement in your offerings, then start streamlining all your business processes, including operational and transactional processes.
Make your team the best by utilising each team member’s potential and ensuring connectivity between the different teams that work under you with effective communication. The better the inter-team communication, the more seamless your workflows will be.
In today’s day and age, it is hard to keep a business running smoothly without automation. Automation not only saves you a great deal of effort and man-hours but also eliminates the hassles of human error from the picture.
You also need to be careful with your hires. You can depend a reliable outsourcing partner as per your requirement without committing more people to your payroll. This is because, as a startup, your work schedule will be erratic, and you won’t be able to utilise all resources properly if you hire every time there is a necessity. However, if you are convinced that you simply must employ new personnel, make sure that it’s an excellent hire that is an asset to your startup in the long run instead of a liability.
While optimising your finances, you need to be careful with your bank balance. You might have had an incredibly successful fund-raiser and more money than is necessary for your startup at present; this does not mean spending it lavishly. Check your budgets at all times, especially before scaling up, and trim all excess costs to stay financially responsible.
Make Sure Your Startup Does Not Need Training Wheels
Finally, make your startup self-sufficient in all aspects.
Your business must be organised in such a way that it is always ready to stand on its own feet without any external support, even from yourself, before you can even start contemplating scaling up. The training wheels must come off as soon as possible because the longer your business has stayed independent, the more your chances of scaling up without too many hurdles slowing you down.
Your business must also always be ready to change ownership, even if you have no intention of handing over the reins to anyone. You have to streamline your business processes so that the entire structure does not fall apart if you have an emergency and need to take a few days or even weeks off from work. What’s more, your business should keep up its growth pace irrespective of your presence or absence.
One way of ensuring business continuity even while scaling up is to try to stay on top of things when it comes to keeping your business affairs in order at all times. An essential aspect of keeping your business scalable is preparing and implementing compliance solutions.
Business compliance is the process of making sure that you and your team abide by the rules, laws, and regulations that are mandated for your industry. Implementing compliance solutions for your business and documenting compliance reports will give you an advantage in the face of unprecedented business risks, which is something you must be prepared to face while scaling up your startup.
You must also keep updated business information records for your startup. This will not only help mitigate risks by keeping a check on your company’s operational and financial aspects and help you be mindful of how well your business is functioning. Keeping credit reports handy will also give you an upper hand when sudden opportunities to form partnerships arise. You do not want to miss out on the chance of a lifetime just because of shoddy paperwork.
Also, make it a point to distance yourself from creating credit debts. This will affect your business adversely in the event of expansion. Do not borrow in the name of your business. Instead, work with what you have, and eventually, you will be able to raise the excess amount needed to level up.
