You’ve done the backbreaking work of getting your startup off the ground, making your first sales, and even hiring a few employees. As business begins to steadily grow, you’ll face the question of when you can make the big push to scale your company and really take things to the big time. Check for these prime indicators that you’re ready for growth before you move ahead.
1. Demand exceeds supply
You’ll know you’re ready to consider massively scaling your company when the demand for your product or service is greater than what you can provide. If you no longer need to approach chains about selling your product because big name retailers are coming to you first, you’ve finally made it. When you reach the point where you’re unable to fulfill orders, you need to brace for the next wave of growth. Increased demand also allows for increased prices.
2. You have a clear business model
You can’t grow your business successfully if you don’t know where it’s going. Your brand should be well established with a customer base who understands your product line. A scalable sales model has low customer acquisition costs and consistent conversion rates and revenue. At this point in your business growth, you should be using a well-known product like Sage accounting software to keep your accounting clean and understandable.
3. Your numbers are solid
You should know your numbers intimately before you consider taking your business to the next level. Scalable businesses have high margins of 50 percent or more, according to Forbes contributor Martin Zwilling. Their employees are highly paid, and the product is flying off shelves to customers paying full price. If you’re still limping along financially or you don’t know the state of your finances off the top of your head, you should make to-do lists and get your affairs in order before you attempt to scale.
4. You have strong investors
Zwilling warns that organic growth won’t allow for the kind of dramatic scaling that you want when you’re ready to take your business to the next level. Reinvesting your profits allows for slow and steady growth, but when you want to make a big leap, you need investors. Make sure you have strong investors in place who can supply not only financial assistance, but business expertise and valuable contacts as well.
5. You have the hours and manpower for growth
Scaling your business is about more than money. While you do need to secure proper financing for your company to make it big time, you also need to have a team on hand who can handle the new challenges. A workspace organized online takes everyday duties off your hands and provides your team access to important projects and documents. At this point, the business founders should no longer be working for the company, frantically handling day-to-day duties. Instead, you should have ample time available to focus on growing your business while others handle the minutia.
If your business meets these qualifications, you’re ready to scale the company and take on your industry at a whole new level. Get ready for your next big step, because it’s time to move on up.