If demand constantly exceeds production and you can’t seem to clear your feet of tasks, it may be a sign that it’s time to scale up your small business.
Do you own or run a small to medium business? Are you beginning to struggle with finding the balance between customer demand and product manufacturing costs? If procurement is an issue and demand exceeds ability then it may be a sign that your business needs to scale-up.
What Is Scalability?
Scalability is important to modern business. It describes the way the demand for work swells and recedes over time. Popular products cycle in time with fashions. Retro clothing might be hot one day and cold the next.
Since tastes and trends change everyday thanks to the internet, it becomes vital for businesses to respond in an effective manner. This can include the act of scaling your business to meet your client’s demand. It may be that your primary products are in short supply one day, but then in excessive supply the next.
A business’s ability to grow to meet excess demands while simultaneously being able to shrink when demand is low is known as scalability. The more scalable your company, the more agile it is. The longer your business stays agile in line with consumer desires, the greater the longevity of your corporation overall.
What are the Signs Your Business Needs to Scale Up?
Scaling up means investing more money, time, and energy, in the parts of your business which perform best. Say you sell ice cream and have noticed that customers prefer chocolate covered ice creams to non-chocolate ones. Scaling up might mean investing in a heated urn for chocolate sauce, so you can dip your cones and make more money on each sale.
How do you know when it is time to scale up to that new chocolate urn? Look out for the following signs.
Signs It’s Time to Upscale
Signs that your business needs to grow to meet demand include the following things.
Supply Regularly Exceeds Demand
The most prominent sign that your business needs to grow is that you have too much work and not enough time to do it. If your supply does not meet demand for your products, then it is time to look at ways to boost that supply.
You Routinely Feel Burnt Out
Feeling burnt out often as a SME owner is a clear sign that you need to take on some help. Taking on new employees is upscaling on its own. Taking on more than one at a time is a clear sign that your business is headed in the right direction. Take a step back, look at why you are constantly exhausted, and evaluate whether you are making enough profits to invest in another team member. Twice the team size means meeting twice the targets.
You Turn Down Potential Business
If you find that you often tell clients you cannot take their job as your operation isn’t big enough to take it on, then perhaps it’s time that your organization scaled up to meet those consumer expectations. Equip yourself with enough resources to complete first one larger job and then another. You will have teething problems, but over time this leads to a massive growth in products.
You set goals when you first begin working for yourself. These goals might be in terms of productivity, time, or cash earned. Whatever your goal may be, when you begin to surpass those goals, it is time to move up a step. Regularly blast your own goals out of the water and you qualify for the fast track to success.
Lack of Inventory or People Power
If you don’t have enough staff or you can’t meet the workload demand, then it is time to upscale your business. Buy more inventory, hire more people, and get more work done. At this point you may wish to consider investment opportunities to help you buy the equipment you need to speed yourself up.
Remember, you can find hints, tips, and tools on how to effectively scale your business in our previous article.
What are the Signs Your Business Needs to Scale Down?
Just as a business doing well may wish to scale up, businesses which are no longer performing to such high standards can use the same trick to lower expenses and save on profits. This involves shrinking your operations to a smaller, more manageable client base.
Scaling down your business may be necessary to eliminate expenses over time. Try not to think of scaling down as failing, you are simply adapting your business to meet the available resources. This is an important step in the process of responding to consumer needs. Focusing on regular clients and laying off excess staff is part of being a good businessperson.
Is It Time to Scale Up?
Is it time to scale your business either up or down? Following the signs outlined in this article will help you make the correct judgment.short url: