EA - Are You Building a Scalable Small Business

Are You Building a Scalable Small Business?

Most small businesses start with a simple idea and hours of work in the basement or garage. It doesn’t take much to identify a potential opportunity in an industry of your interest. Some of the best inventions were born out of necessity with individuals looking for solutions to solve their problems. If you are in the position of designing a startup or running a small business, it is important that you are not only looking at your current responsibilities… but also evaluating your options for the future. A few things can be done right now to ensure that you have a scalable small business.

What Does it Mean to Be Scalable?

When investors can see that your business idea has potential, then they will be ready to offer money to help the company grow. A scalable small business is designed so you can multiply revenue for future business growth with minimal costs to expand.

If you have a scalable small business, then it means you have a proven business model and a proven product that consumers love. Once the systems are in place, the next step is to expand the business efforts to other markets and geographies. You don’t have to re-invent the wheel when you want to move to new markets. Instead, it is a “lather, rinse, and repeat” process to implement the same business systems over and over again to new customers.

For example, most business owners have significant upfront costs to develop the product or service that will be offered to the ideal demographic. You will spend time and money on the iterations to ensure that everything is perfect to meet the needs of your customers. Once these systems are designed and in place, then it requires minimal expenses to make additional products that can be sold to others.

How to Build a Scalable Small Business

Here are simple tips that can be implemented into your business plan to ensure that you have options to scale your company in the future:

  1. Attract Investors: When you are ready for business growth, you might run into the roadblock of not having enough cash to pay for the expansion. Just because you and your friends think that it is a great idea, doesn’t mean that investors will be ready to jump on board. As you are building your business plan, consider strategies that will make the opportunity attractive to investors. For example, use market research from outside experts and build documentation showing your profit margins and customer satisfaction.
  2. Continuous Improvement: Just because your business is going well right now, doesn’t mean that you are set up for success in the future. Too often, people run as far as they can with one business idea, only to find that the market fizzles out when the next trend moves in. It is essential to look for ways that you can implement continuous innovation. Instead of offering a single product, you can identify complementary services and products that will continue to solve your customer’s needs in the future.
  3. Work “On” Your Business: As the business owner, you are the point that is directing all actions and decisions made within the company. In the beginning, the business won’t continue with daily progress without the integral role that you play in the system. Ask yourself: how much time are you spending working “in” your business? If all systems come to a standstill when you are on vacation, then it might be time to rethink the way you are building the system. Instead of working “in” your business each day, look for ways you can work “on” your business to create a plan that can be scaled. You only have 24 hours in a day, which means you will be limiting your business growth depends on your involvement.
  4. Build a Good Team: Over time, you can build a team that will keep the system running, regardless of your involvement in the day-to-day responsibilities. One strategy is to bring in the right employees to oversee all aspects of business management. For example, you need front-line customer service representatives, salespeople, managers, product testers, and more. If you are worried about the overhead costs that will be accrued for in-house staffing, then you might consider the option to outsource these services instead. Outsourcing offers an effective way to reduce your spending while tapping into the experience and resources required for your business systems.
  5. Leverage Technology: Tech plays an important role in business management, so it makes sense to take advantage of every benefit available by using technology. If you are stuck using outdated systems and manual processing, then it is time to revamp your company to implement as much automation as possible. For example, it is a waste of time if you are paying employees to handle manual data entry for every transaction that moves through your company. Instead, find the right accounting and bookkeeping software that automatically pulls in the transactions that move through your credit card and bank accounts. This automation frees up your employee’s time, giving them the ability to work on other business-building activities.
  6. Always Automate When Possible: One way that technology can be used is by automating systems and redundancies. If your startup is staff intensive and labor intensive, then it is hard to scale because of the number of people that will need to be hired. The best thing that you can do is start early to identify ways that your systems can be automated. Documentation and processing can be organized and streamlined using technology. You should also evaluate ways that training can be shared to all through online videos instead of training new employees one-on-one. These systems will allow you to bring in new people consistently and quickly as needed to support your business efforts.
  7. Hire Marketing Experts: You can offer the best product in the industry, but have minimal sales if your customers don’t know about your company. Too often, business owners get stuck because they pour money into business development without leaving anything left over for marketing and advertising. As a business owner, you shouldn’t be spending your valuable time reading online internet marketing forums and testing shady marking strategies. Instead, find a marketing expert that understands your industry and can help you connect to the customers who are looking for the product or service you are offering.
  8. Accept Funding When Needed: You can only get so far with organic growth. This process means that you are reinvesting profits to help your company grow, but you will find that your progress is limited without a bigger infusion of cash. Investors can add the fuel needed to boost your rocket to higher altitudes. Even though you will give up a bit of control by accepting money from investors, you’ll find that many benefits come from the experience and expertise offered by these people. Do your due-diligence to ensure you are selecting investors that are a good match for your company. Then, find a win-win solution to leverage their money and your business ideas to bring in profits for everyone involved.
  9. Explore Options for Franchising: If you have a proven business model, then franchising is one solution that might help you expand to other markets. Instead of trying to out-market the competitors, look for ways you can bring them on-board by showing the documentation and profitability that they need to get on board with your business plan.

Do You Want a Scalable Small Business?

Not everyone wants to build a multimillion-dollar company. If you are creating a home-based business to bring in a little extra spending money each month, then you might not have the desire to get involved with investors and large-scale systems.

The most important thing you can do is evaluate your long-term goals and determine the incremental progress that will help you achieve those goals. What are your revenue goals? Are you interested in developing more products and services in the future? Asking these questions can help you decide if you want to put in the effort to scale your business efforts and help your company grow.

Whether you are happy with the current size of your company or you are looking at growth opportunities in the coming years, it can be beneficial to have the support of an experienced outsourced accounting team. Managing the financial details of your business can be both stressful and burdensome. Luckily, you can hand off these responsibilities to an accounting and bookkeeping team. These outsourced services will allow you to focus your efforts on the things that you enjoy most, giving you more time and freedom to build the type of business that you desire.

For more information about small business accounting and bookkeeping services, you are welcome to contact our team at Easier Accounting. We specialize in all the services required to keep your small business running each month. Not only can our team help with payroll processing, but we can also offer the assistance you need for tax strategy, ongoing bookkeeping, and more. Call today to see how we can help: (888) 620-0770

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