Business Growth VS Scaling Your Business - Why it's Important To Know The Difference
Most business owners have business growth on their mind. However this is often where they go horribly wrong.
The key to exponentially growing a business lies in understanding the difference between growth and scale:
Growth is the process of increasing in size. Many of business owners view growth as simply being ‘the process of increasing in size’. Getting bigger, getting fatter. There is nothing wrong with this -- It's natural. Until the business owner runs out of time, realising that the growth of their business is directly correlated to the amount of time that they spend in the business.
Growth tends to be an arbitrary business goal – like “I want my business to get bigger”, “I want to increase staff”, or “I want to secure more office space”.
Scale means that your business has the potential to multiply revenue with minimal incremental cost. If your business is ready to scale, you have a proven product or service, business model, and a planned strategy to expand to new geographies and markets.
The key difference with growth is that scale is achieved by increasing revenue without incurring significant costs.
You see, growth on its own is simply increasing units of production to achieve a linear increase in output. For every resource you add to the business, you are aiming to achieve the same value of return. Ask yourself: “Do I want to work more to increase profits or become more profitable?”
If you want to stop trading time for money, stop experiencing groundhog day, stop chasing clients for money, remove yourself from the shackles of your business....... then you want SCALE.
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Action Steps You Can Take to Scale Your Business Today
Like pro athletes, a business owner can only rely on sheer talent and hard work for a certain period of time, until they run out of ability or daylight. Business is a game - here's how to play and win.
Our Strategic Planning Workshop follows these key steps to SCALE any business:
1.What do you REALLY do......no really? Like a poker game, you must be VERY careful about the table you choose. Sit at the table where you know you can win. Business is no different.
COMPETE WHERE YOU WILL WIN. Get clear on what you do and your niche. The more specific, the better. If you are an architect, what sort of architect?
2.Who do you serve? Know you know where you play, work out your best customer. Sometimes it's easier to start with the exact customer you DON'T want. Get clear on your customers pain points and trigger points.
3.Be prepared to say NO - Warren Buffet famously said "Really Successful People Say No To Almost Everything". It's tough to do. Not everyone looking to be your customer, is actually a GOOD customer.
4.Build Partners - Who ever forgets a good restaurant recommendation? You ALWAYS remember the person who recommended that awesome restaurant - it's the same in business. Build partnerships with remarkable service providers who are brilliant at doing what you don't do......and recommend people to them who are not your customer. MOST IMPORTANTLY, ask for a fee in exchange, they'll be happy to give it to you!
5.Productise - Build a fixed price, fixed output solution for one of your customer persona's (customer types). The beauty here is that you will have fixed inputs, therefore your margins are locked in. Rinse and repeat. Follow our 7 step PRODUCTISATION process to help you productise your service.
6.Measure everything - Things that get measured, get done. Live off the data and report, report, report! Build daily, weekly and monthly reporting across financial and non-financial metrics.
Remember: “Success leaves clues”. Jim Rohn coined this phrase, and it means that you can learn the methods of success from other business owners and experts. Business is a game.
Businesses owners all want to grow, and it’s about understanding these principles of growth and scale, then putting an action plan together to achieve SCALE, not GROWTH. Get fitter, not fatter.
If you are ready to take the next step......Click here to schedule your FREE strategy session with our founder - Sam Musgrave.
PS. We set this stuff up on a daily basis for our clients - if you want to transform your business in 90 days, CLICK HERE.