Is your business built to scale for the long term? Here are 5 questions to help you sort that out

Is your business consistently achieving profitable growth over the years? How do you remain competitive in the face of increasing competition? Can you financially and operationally keep up with your pace of growth for the long term?

Apart from creating value propositions that stand out and are difficult for competitors to replicate, business leaders also need to pay attention to how their business can remove the current cap on their ability to grow and scale.

Working with scale-ups has taught us that sustainable, long-term growth and scale can only be achieved when business models are built to expand from the outset, as well as strategically respond to changing needs without falling into profit and productivity losses.

Is your business built to scale?

But what happens when your current business model is not built for expansion? 

These 5 questions can help you sort out what strategic tweaks you need to do to adapt to increasing workloads, market demands, and production. 

#1 What additional distribution channel/s can you add to your current business ecosystem?

Working with scale-ups in multiple industries has allowed us to witness the benefits of omnichannel distribution first-hand. In fact, it is something we highly recommend.

When done right, adding new distribution channels to your business can help your company effectively spread overhead costs while reaping the profits from increased sales.

We found this to be the case for our clients Vanessa Megan and espresso Displays (additional reading: Aussie tech hardware company grows 24x in 12 months: How we did it parts 1 and 2). 

While already enjoying good sales prior to working with the BeingIconic team, Vanessa Megan and espresso found that their businesses were not scaling fast enough for the number of investments they have put in.

As we were building better eCommerce experiences to cater to a wider customer base and generate more profits, they found that their sales increased to 60% and 1,000%, respectively — all in less than a year.

Another example we could think of is Sprout Stack.

Originally an equipment manufacturer of AI-powered plant growing systems, Sprout Stack pivoted to using their products themselves and, in the process, grew amazing produce that they now distribute to Sydney’s best restaurants and grocery stores.

So, ask yourself: Can my business benefit from additional eCommerce, B2B, or B2C channels? If yes, which is the most cost-efficient path to take in order to hit our targets?

#2 How is your business rising above traditional capacity and performance restrictions?

Capacity and performance restrictions vary from one industry to another, but the strategy stays the same: To find ways around them and, eventually, generate more profit.

The most successful businesses are the ones that have found workarounds to traditional bottlenecks. Take Canva, for example.

Prior to launching Canva, Melanie Perkins wanted to work around the restrictive nature of Microsoft and Adobe design programs. For people to use them proficiently, they will need to spend weeks or even months learning every tool and feature.

To address this, she started Fusion Books — an online high school yearbook design platform where students can collaborate and design their own profile pages and articles.

Long story short, Fusion Books found international renown and became the biggest program of its kind in Australia, New Zealand, and France in just five years.

But Melanie wanted to go bigger. Thus, the birth of Canva

By democratising design for all of its platform users, Canva was able to scale exponentially across 190 countries. Today, the brand has over 60 million active users, including big-name companies like Marriott International, American Airlines, Salesforce, and PayPal.

Start by digging deep into what your current industry restrictions are. How is your business working around them? Are you able to create additional revenue streams by marketing solutions to these restrictions? And what additional markets might benefit from these solutions?

In this case, chase the restrictions, think of workarounds, and develop a system that packages these solutions into something you can offer to your clients.

#3 Who can you tap into forging strategic partnerships with?

Are there potential strategic partners in your industry (or beyond, if possible) that could add new ventures or contribute resources to your business model and boost your value proposition?

Business partnerships are like strong marriages — they split the responsibilities, give sound ideas, and contribute complementary skills and resources that bring out the best in each partner.

When it comes to partnerships, business scalability requires thinking beyond splitting costs. It calls for tapping into strategic partnerships that will add to your current value proposition. In other words, find ways to streamline workflows, simplify product offerings, and reduce expenses.

In some cases, you can even forge partnerships with competitors as long as it adds value to your company.

As an example, we look into the partnership between competitors Shippit (one of Australia’s biggest multi-carrier shipping software) and Australia Post (Australia’s biggest shareholder in the postal and delivery markets at 80%).

Their surprising, yet innovative partnership not only provides an opportunity for Shippit to join the big leagues while influencing and scaling their tech’s reach at a rapid pace, it also serves as a stepping stone for Australia Post to make its services more competitive and relevant to today’s needs.

#4 What questions do you need to ask in order to spark ideas about how to redesign your business model?

When trying to map out new ways of operating, think about how each of them unfolds for your business.

Are they challenging your existing business thinking? What can you do differently to make this business model successful? What can you learn from other companies that brilliantly execute what you are trying to do? 

What knowledge, skills, experience, training, and creative abilities are needed for this particular business model? Could this business model lead to more scalability?

Once you gather ideas from these questions, clarify which areas you can scale.

Is it with potential strategic partners who can contribute key value drivers (at minimal cost, while receiving value themselves) to boost existing customer value propositions?

Is it with new systems that eliminate your business’ current capacity and performance restrictions?

Is it with creating new, income-generating distribution channels that other businesses can get on with?

Is it with changing existing shareholder roles so you can use them in new (and/or multiple) roles within the business ecosystem?

Is it with creating a market that would pay for customer data access?

Is it with creating mechanisms to ensure customer lock-in?

Is it with making your company more agile in responding to threats from new competitors or new disruptive technologies?

#5 How are your business model ideas going to fare on the scalability spectrum?

After gathering ideas from the questions above, leaders must now evaluate which business model attributes and configurations will serve the business’ bottom line best.

The sweet spot of business model scalability involves pinpointing where exponential growth happens and where it does not. How can you determine this?

One, you can learn from others. Two, you can learn from experience — albeit a little risky.

Which part of your business is not giving enough returns despite additional resources being poured into it? In this case, consider downsizing that area to protect your business’ overall value.

Which part of your business is consistently generating returns the more you invest in it? In this case, find other channels to invest excess capital in and double your profits in the long term.

Whether you are revamping an existing business model or developing one from scratch, it is not enough to create a strong alignment between value propositions and customer needs. You also need to prioritise synergy between your value proposition and your partnerships.

We have been working with numerous scale-ups in developing business models that not just help them stand out, but also allow them to grow and scale exponentially in both the short- and long-term. Partner with us today if you want us to do the same for you.

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