It’s not always easy to know when it is time for your business to grow. Many factors need to be considered, including cash flow, market size, and resource availability. When first starting a business, many business owners start small with intentions to grow in the future. But how do you know when the time is right? Here at Baby Got Bot, I want to help you figure out if now is the time with the below Growth Checklist. This checklist will make sure you have all of the important information in one place to make an informed decision on when it might be best to scale up. Answer the following questions to take the first step in understanding if now is a good time for successful scaling.
Questions to consider
- Have you reached the point of market saturation?
Market saturation means that a market is tapping out, and there is no more room for growth. Market saturation can happen in a niche profession or field- for example, lawyers specializing in patent law may find their client base exceeds the number of potential clients available. Once you have reached market saturation, it may be time to expand your business into other niches and scale.
- Do you have enough resources available to support growth?
When it comes to scaling, you need to ensure you have the resources necessary to sustain the growth of your business. If you haven’t first had the time to build a strong foundation for your business, scaling may not be the best idea. You always need to ensure that your company is ready to take on growth- even if it’s just an expansion of your current clientele!
- Is there room for more people working within your company?
If you run your business out of an office, you need to consider bringing in new employees if you have the space. A great solution is to offer telecommuting work to new hires if the position allows for it. No matter how you hire, make sure you have the proper structure for taking on and supporting new employees.
- Are you able to handle the additional workload without compromising quality?
If your business is service-based or the person who creates the products you sell, you need to assess whether you can personally take on more work without diminishing the quality. If not, you will need to consider hiring people to help you, or you may want to put off scaling until you can.
- Can you afford to hire new employees?
Before scaling, make sure you can afford the best talent for your business. You don’t want to build up a team full of people who are not well suited for your business or who are not producing at an optimal level. Step back and look at what you have now- if it’s not working, consider making changes before bringing on additional people.
- How much money does your current revenue bring in per month/year?
If your business is still producing a profit, but it’s not as much as you would like to see- consider the possibility of scaling. As with most companies, it’s all about having enough money to cover expenses and making a profit. If you can provide for yourself and come out ahead financially after scaling up, then it might be worth it.
- How much debt do you owe on the business?
Debt can be a significant strain on your company and its growth prospects. When you take on debt, make sure it will help you operate more efficiently and profitably- not hinder you! If you have some debt leftover from before, you can consider scaling if the business still makes a good amount of money.
- Does your product offer any unique value proposition compared to competitors?
Consider scaling if you can offer a unique value proposition but don’t have the traffic necessary to take advantage of it. Your current competitors may be producing and selling similar products and services as you, but if yours offers something unique, then now is the time to scale up!
- Will your customers accept changes to their experience as they move towards more prominent companies?
Above all else, you need to ensure that your customers will still be happy with the quality and service they receive even as you go through a scaling process. It won’t be easy to scale successfully if you don’t have a positive track record of customer service and satisfaction.
- Would you prefer to stay small or grow big?
The most important question is whether you would like to continue the business as it currently stands or if you want to take on a more significant level of responsibility and risk. If you’re not happy with your current position, then scaling up might be for you- but don’t do it just because you heard bigger is better! In some businesses, staying small is just fine.
The decision to scale or not can be a difficult one. You want your business to reach its fullest potential, but you also want it to stay true to the values that have made it successful so far. That’s why we always suggest taking some time for reflection before making any big decisions about scaling up your operations. Use the above checklist of questions as a starting point when considering whether or not you should grow your company.
We hope this has been a helpful guide for you! If you have any questions or comments, feel free to leave a note in the comment box below.