How do you know when it’s the right time to scale?

As a business coach, I’ve seen businesses struggle with this question. They have thriving businesses and are cautious about pushing past their boundaries to expand.

While it’s an expected reaction, it defeats the purpose of why you started the business in the first place. Scaling your business is the natural step towards success. There will indeed be risks. But with careful planning and consideration, you can achieve sustainable growth, leading to massive success and freedom of time.

In this article, I want to help you identify the signs telling you when it’s the right time to scale. You’ll learn about the challenges and considerations you’ll go through - so you can determine if your business is ready to scale and how you can do it successfully.

Challenges Faced by Businesses Needing to Scale

Starting a business feels like an uphill climb. Everything takes effort to plan, create and implement. From the product and service to the team and systems, you have to exhaust your time and effort to make sure they’re all successfully implemented.

Once everything is set and running smoothly, what happens? The business keeps improving. Soon, what you’ve set for the business will stop working seamlessly. You’ll see specific challenges indicating that the growth can no longer be sustained by the current business dynamics.

This a sign that your business needs to scale. Here are 6 challenges faced by businesses ripe for scaling.

Supply can’t keep up with demand

This feels like a double-edged sword but still, it’s one of the first signs that your business needs to scale. When you start struggling to meet the demand of the market, you need to think about growing the business to meet it. At the very least, your operations need to improve to accommodate the increasing demand. Otherwise, you’ll max out your revenues, leave customers unsatisfied and hold back the true potential of the business.

Leaders are occupied with operations

If you find yourself occupied with operations to keep up with the demand, that’s a sign your business should consider scaling. A leader’s job is to oversee the operations and not be in the midst of it. You need to be free to focus on the vision and overall business strategies to help the company thrive.

Once you feel forced to join the fray because the team can’t handle the deliverables, it’s time to consider implementing growth strategies.

Employees look for growth opportunities elsewhere

Is your team starting to leave for better growth opportunities? If it’s not related to management issues or compensation, it’s most likely that employees fail to see an ability to grow in your company. It stifles their motivation and keeps them stagnant. This is a good enough reason for them to leave for greener pastures.

That’s a sign they no longer think your company can grow. It’s not keeping up with their career growth aspirations. You need to start thinking about scaling the business to give your team room to grow in their career.

Inability to grab business opportunities

Do you find yourself having to turn down opportunities because your team and resources are already stretched thinly? If your business can’t handle the additional workload, your reaction shouldn’t be to turn it down. It should be to think about how you can scale your operations so you can accommodate the new opportunities coming your way.

Stop missing out on the growth potential of your business. When your current capacity is maxed out, start scaling.

Operational bottlenecks exist

Bottlenecks are operational inefficiencies that can compromise your business. It’s a sign that there are processes that haven’t scaled with the growth of the business. This slows down operations and reduces productivity. If not dealt with, this can compromise deliverables and client satisfaction.

Identify these bottlenecks and make sure they scale enough to keep the business operations smooth and efficient.

Resources are drained

If the business resources are constantly drained without sufficient revenue returns, that’s a dangerous sign. It could lead to catastrophic results that will compromise the ability of the business to keep operating.

When this happens to your business, it means you’re ready to scale but you lack enough planning and infrastructure to make it happen.

5 Considerations Before Scaling the Business

If you’re struggling with any of the challenges mentioned above, it signifies that your business needs scaling.

But just because it needs to scale, it doesn’t mean you should blindly jump to do it. There are a couple of considerations first to ensure you’re doing the right thing. It’s important to approach this with a strategic plan so you can succeed in scaling the business without causing it to fail

To determine if your business is capable of scaling, ask yourself the following questions.

Are you smashing targets?

This means the demand exceeds supply or sales and revenues are maxed. If your business is hitting targets and smashing them to the ground, then it means your business is capable of taking on more work. Exceeding goal expectations is a good sign - as long as this is sustainable and not a temporary spike.

Do you have strong finances or access to more funding?

Scaling the business would require a financial investment. Check your current business finances to see if it’s stable enough to support your scaling efforts.

In case you find it lacking, do you have access to additional funding? Look at your creditworthiness. If you can get a loan approval or investor backing, this can support your business as it scales. Or if you have personal savings you can loan the business, this would work in your favour as well.

Remember, even if your business is ready to scale, you need strong financial standing to do it successfully.

Is your business model effective and reliable?

If your business has a robust business model with a sustainable infrastructure and the ability to keep up with the competition - then it means you can afford to scale. All these mean your business operations won’t falter or compromise quality as you make adjustments for the growing demand.

But if you’re currently struggling and the business model is unstable, strengthen it first before you proceed to scale the business.

Do you have a capable team and recruitment process?

Your team is an important factor to consider when scaling the business. After all, they’re the ones who’ll take on the extra load as you begin to accommodate the increasing demand. Make sure you have the right talent in place to help scale the business. Evaluate your current team and see if there will be a shortage of manpower and skills.

Hire and train a high-quality team so they can successfully support the growth of the business. Having a solid recruitment process is crucial to keep a seamless business operation.

Are you getting more organic customers?

If your reliance on paid advertising to get new customers is decreasing, it means you’re getting more organic customers. They are driven by the positive feedback and referrals given by previous clients. This is a positive sign your business is doing well and you’re ready to scale.

It shows that your customer base is expanding - which usually happens when there’s strong market acceptance and high satisfaction. Your business has to grow with this expansion to accommodate the demand that will result from it.

If It’s the Perfect Time to Scale Your Business…

Scaling your business is an exciting but risky endeavour. By keeping an eye on the challenges that your business is currently going through, you’ll know if it’s the right time to scale. Analysing the capabilities of your business and team will also ensure the scaling efforts will be successful and productive.

Remember, this requires strategic planning, strong financial health and a capable team. These can support your efficient business model as it goes through the changes needed to scale.

At this point, your business would need all the support it can get. Partnering with a business coach to help with this growth transition would be a wise and strategic move to ensure success.

If you want to start scaling your business, let’s talk. Book a complimentary 15-minute call here: https://www.butleradvisory.com.au/time-with-trent.