Scaling your business is a big step, and a big risk. Do it too early and you risk sinking capital into a move that might not achieve the necessary returns. On the other hand, if you don’t see the opportunity when it arises, you could miss a chance to make a lot of money. Or even worse, your company could stagnate and be overtaken by competitors.
So what are the signs you should be looking for?
1. You have met most of your business goals.
Not the long-term “try to take over the world” goals, but the interim “make X annual revenue”, “hire X staff”, “be the dominant business in the local market”, and “not have to work weekends” kind of goals.
Chances are, if you look at your goal list and see mostly ticks, it’s time to look at scaling. If you don’t have any readily-achievable goals, then you need to create some new ones or risk stagnating in the “comfort zone”.
2. Revenue has hit a ceiling because you have maxed out your market.
You’ve reached everyone you can reach in your local market, you’re well known for your core product and being used by the majority of your addressable market. You’re essentially a big fish in a little pond.
This is especially true if you have excess revenue. If your company has a steady cash flow, then it is worth considering putting that cash into expansion.
But it isn’t enough just to have cash lying around. You need to have a good financial forecast. This requires a certain amount of stability in your company. You should be confident that the company will continue to make a steady revenue, or you risk sinking it all.
A great example is finder.com.au. Just last year they took a giant step in scaling their business by making the decision to expand to the US. Founders Fred & Frank grew finder.com.au to be the leading financial comparison website in Australia, and they were ready to move one step closer to their dream of becoming the leading comparison website in the world.
Hear more about finder.com’s launch here.
3. The customers are coming to you.
When you started your business, you probably had to go knocking to find buyers. As a product or service becomes more popular and successful, the natural development is that existing customers will refer you to new ones.
Hopefully you will find yourself in a place where most of your new customers aren’t ones that you personally canvassed, but ones that seek you out. This is a good sign that your company will have success on a larger scale.
