When thinking of growing and scaling up your business, its very important that you work out those parts of the business that are profitable and can be replicated before you start to embark on an expansion plan.
The reason being, attempting to scale a business that isn’t profitable is a bit like trying to be a Silicon Valley tech start up without the innovation or backing of super rich investors. Tech start-ups and other highly technical niche industries are the only ones allowed to scale before being profitable. This is because they are dancing to a different music and have different measures of success (example downloads, users, engagement etc) that ultimately lead to financial success.
I’ve seen far too many businesses attempt to grow despite a lack of clarity around which parts of the business can be scaled and even more importantly which parts of the business need to be “killed” in order for you to be able to grow – profitably.
Part of growing a business is to clearly understand 3 things
- What you need to keep doing,
- What to stop doing and
- What to start doing
The bottom-line is: what products/services/operations directly contribute to paying the bills. Get these right and you are on your way. This is one case where, contrary to popular belief, bigger doesn’t always mean better. Always remember – You can never outgrow failure or problems.
So, over to you, what are some of the challenges you are currently facing in growing your business? What would you do differently if you were to follow this simple advice?