by Mason Gruber
Scaling up is a natural stage in all successful business life cycles, but the timing and execution, can be the make or break difference in its longevity. Expanding is crucial, exciting, and enticing, but when does it make sense to do it? We’ve all heard the expression, “don’t bite off more than you can chew.” To avoid that, knowing when it’s time is key. Here are some indicators that it could be time to start scaling up your business:
Demand Fulfillment is Overwhelming
Too much demand is definitely a good problem to have, but making sure your business can keep up with a severe increase is easier said than done. However, if you are going to scale because of demand growth, you want to truly make sure your eyes, or the numbers, are not deceiving you. Maybe it’s just a good month? Maybe you just got a couple of really big orders? If you choose to scale up you want to make sure the increase in demand will have reason to stay once you are ready to invest in the new overhead.
Rise in Missed Opportunities
Sometimes it makes sense to turn down opportunities. Whether it’s because they aren’t a good fit, the job is too expensive, too time consuming, or whatever the reason may be. However, when you start turning down more and more of these opportunities, because the order size is too big for your company to handle, waiting to expand leads to a significant rise in lost opportunity. As a business owner, nobody WANTS to turn down jobs because you are not ready to handle it. Don’t go doubling the size of your company because of one missed opportunity, but if it becomes a common occurrence, then it is time to get the ball rolling.
Inventory Constraints
Lack of warehousing space for inventory can be a real hurdle in sales fulfillment if you are not thinking ahead. Thanks to technology, and companies like amazon that can assist your business with transportation and fulfillment centers, planning ahead for inventory increases is crucial in making sure your business remains on the right trajectory.
Customer Demands
In order to retain customers, it may require you to think about what else you can offer them. Perhaps you can add more products or services that compliment those that you currently offer. Think of it like this: if I have a customer who really likes my hamburgers, and I don’t have any french fries to offer him, or a nice Coke to wash it down with, odds are they’ll go to a more encompassing restaurant. Having a wider array of products and services may seem overwhelming, but it may be a necessity to keep your customer base from walking across the street.
