7 Tips When Building A Scalable Business
A scalable business is a business that has the potential to grow and generate revenue with minimum incremental cost. Many people start up business hoping to increase revenue by building a strong customer base which directly implies increasing delivery of goods and services that calls for hiring additional stuff to meet the demand. This will definitely lead to substantial increase in fixed costs.
Scalable businesses look to structure the company in such a way that increasing customer base will not call for expensive hiring processes or building additional facilities such as a factory. A software product is one of the classic examples of scalable business, it takes real money to create the first copy, but unlimited number of copies can be cloned for almost no incremental cost.
Scalable businesses look up to take advantage of economies of scale or call for others to invest in their capital. Here are some tips to consider when building a scalable business. For more, see www.intelligentbusinesstransfer.co.uk
1) Start With A Scalable Idea
Just because your business idea sounds cool to you and your friends, it does not necessarily mean it is scalable. A scalable business will require a lot of research, planning and strategies to make it work, before investing your precious time and money in any business idea; you need to consider whether the idea lends itself to scalability.
2) Come Up With An Attractive Business Plan
You can never go into any business without first creating a reasonable business plan. Most people come up with plans that tout free products for customers; well it may attract customers but remember scalable businesses are hard to build on free high support products. Scalable businesses have high profit margins, 50% and above plus low support and minimum staff.
3) Build A Strong Team
If you are spending too much time working ‘in’ your business rather than ‘on’ your business, then you are not qualified to scale. A scalable business needs to be up and running without necessarily needing you to be there to make all the decisions and doing all the work. You need to hire the right people who can do the job even in your absence
4) Focus On Marketing And Indirect Channels To Make Your Startup Visible
Every business product needs marketing so as to get the message out, otherwise how would people know of its existence? Direct marketing however is not scalable especially on low cost high volume products. These days there are many avenues and technologies on which to market your products and services, word of mouth is not scalable.
5) Use Automation Services To The Maximum
A scalable business does not require a lot of staff to grow, from the beginning, make use of automated services to reach customers more efficiently anytime anywhere.
6) Consider Franchising
If you already have a proven model or product franchising is more scalable than having you manage every location.
7) Attract Investor Funding
A scalable business will not grow on organic funding only; it needs investors to maximize its growth beyond geographical boundaries. You may have to give up some control of the business to investors but their expertise and experience is worth the cost.