Every entrepreneur definitely wants progress in their business. However, not all businessmen know when is the right time to take their business to the next level or what is called scaling up their business.
Some people already know the right time, but have difficulty getting additional capital. Even though online business opportunities are getting wider, then what should we do?
Just like looking for a business mentor and finding business goals , determining the time to scale up your business is also very important to pay attention to.
Relax! First of all, make sure that your business is settled . At least, your business income or profit figures are stable.
If so, congratulations! Your business is ready to scale up . Well, in scaling up a business, it’s not just about getting more income, but also increasing the operational costs of the business.
The swelling of these costs is often an obstacle. Not all business people have extra funds. However, this should not be an excuse not to scale up. Because currently there are many business funding facilities that you can choose from.
What is Scale Up?
Scale up refers to how a business can grow further to achieve shared targets and its greatest potential.
Generally, the context of scale up is aimed at business scales that are still in the development stage, starting from a small or start-up scale.
One of the main objectives of this process is to increase sales volume, brand recognition, and increase profitability ratios.
In addition, scale up also helps businesses maintain their position in the market with other competitors of equal standing.
11 Tips for Scaling Up in Business
The phase when a company is able to scale up is the phase that occurs quickly and is the most significant in business growth, as well as the phase that has the most challenges.
Therefore, scaling up requires a different strategy than when you started your business. Don’t let increasing the scale of your business become the wrong step.
Here are some tips that may help you.
1. Focus on the goal, not the current situation
Don’t base your decisions on the current state of your business, but think about where you want your company to be in a few years. You need to have a clear vision and a good strategy to achieve it.
2. Make sure your business is ready
When you scale your business, many obstacles will come. Weaknesses in various aspects will begin to be revealed, while these things cannot always be fixed when the scale up process is underway.
Therefore, think carefully about the impact of scaling up on your company. Make sure your business foundation is strong.
3. Learn from competitors
Study the strategies of your competitors who have successfully scaled up. Find out the reasons behind their success in growing their company.
Find answers to questions like how many workers are needed, what systems are in place, or what products are sold. Understand their business model and learn from their shortcomings.
4. Protect your business value
Many things can change drastically when your business scales up . The company’s values must not be shaken by the various changes that occur due to the increase in business scale. You must maintain the business values that you have held since the company was founded.
5. Build an effective team
When scaling up , you will definitely need more staff. Starting from a startup with a small number of employees, you may need to adjust to new employees.
However, everyone must realize the importance of your business value . Consistency and quality are key. Create a culture and environment that encourages people to continue to create. All team members must be fully engaged, motivated, recognized, and appreciated.
6. Implement clear rules
Rules don’t have to be stifling, but they should be enough to guide you. Having goals and strategies allows you to know what kind of workforce you need. Hiring the right people in each division is crucial.
In addition, attitude is also as important as skills and experience. Everyone must apply the habit of working smart and walking in the same direction.
7. Ask for expert help
There are times when hiring an expert is not the right solution to your problem. Sometimes it is better to outsource , which is handing over part of the work to another company through a work contract or the provision of worker/labor services. Also be aware of when you need to delegate responsibility.
8. Never compromise on quality and consistency.
There is no point in growing your business if your product or service is bad because customers will most likely turn to competitors.
Implementing appropriate rules and methods and having the right employees and culture are key to maintaining overall quality.
Mistakes are inevitable when stepping up, but don’t use them as an excuse. Understand the cause of the mistake, learn from it, and try not to repeat it.
9. Try to predict the future
Having the right product, processes, and people doesn’t always guarantee a smooth scale-up journey . There’s always the possibility that you’ll run into difficulties that you need to know about before they hurt your business.
If you manage to catch a problem before it becomes serious, then you have time to identify the cause and determine a solution.
Problems can be identified through data analysis, then you can fix them as soon as possible or take preventive measures. Pay attention to the financial situation, monitor cash flow, and measure your company’s performance every day.
10. Identify obstacles
Make a list of the problems you expect to face during the scale up process and use a realistic approach.
Identifying obstacles helps you to address your company’s weaknesses and the threats that may arise.
There are several factors that often interfere with business scaling up which will be discussed in the next section.
11. Support Work with Integrated Software
Every company certainly manages employees, purchases products or services, sells or distributes things, and records finances.
Integrated software enables companies from all industries to integrate and manage all of these basic functions.
In addition, integrated software is useful for optimizing efficiency, improving interdepartmental collaboration, and saving operational costs.
What are the challenges of implementing scale up ?
As previously explained, scale up is the stage of business development that has the most challenges.
Although it can make a company better, scaling up can also disrupt the smooth running of the business if not done properly.
Here are some challenges you should anticipate.
1. Not matching the product to the market
The first mistake that founders usually make is scaling up too quickly .
Many founders rush to increase production when there are still many errors in the product, the target market is not clear, or they do not know whether the market is sustainable or not.
If you haven’t addressed these obstacles, then your company isn’t ready to scale. Solve the problems, perfect the product, and strengthen your company’s foundation before scaling up .
2. Working with the wrong people
Choosing the wrong people, whether suppliers , staff, investors, or internal teams, to work with is one of the most common mistakes founders make .
It’s easy to accept help from others, but you have to think long-term. Remember that these people have a direct impact on your business.
If possible, hire people who have experience scaling up and rely on their expertise, but also consider their competency and fit with your company culture.
3. Focusing on short-term sales and marketing, not long-term demand
When scaling up , many founders focus on increasing their sales and marketing activities, but this is only a short-term tactic.
Gaining loyal customers and building long-term demand is equally important.
4. Engage in a price war
When you start to scale your business, the temptation to compete on price with your competitors is great. You may think that if you can increase production, you can cut prices and still make a profit.
While this strategy may work sometimes, more often than not, price competition will hurt your business, both in terms of profits and quality.
It is better to compete on quality, ingenuity, and customer service than to compete to be the company that provides the cheapest product.
If you sell products at a price that is commensurate with the quality, then you don’t have to stress too much about competition.
5. Do not change the management structure
A management and leadership structure that works for 50 people may not work for 250. Scaling up brings its own changes and challenges, so your team needs to be ready to adapt.
You will need to adjust your management and leadership structure as your business scales.
6. Ignoring problems that arise
A founder who is developing a business must not turn a blind eye to the various issues that arise. The scaling up process can take almost anyone out of their comfort zone.
There will inevitably be issues with the workforce, personalities, or product that will arise. Don’t convince yourself that everything is fine when it isn’t.
Don’t let yourself believe that there is no way out of a problem. You must be prepared to face the problem head-on to avoid long-term damage to your company.
7. Not realizing that pruning is also part of scaling up
Some founders think that scaling up is all about adding and improving. However, as your business grows, you may find things that no longer work, departments that are no longer needed, and staff that are no longer a good fit.
Cutting out things that aren’t working is also important for your company to grow effectively.