All entrepreneurs dream about turning an idea into a global success. The plan is to start as a niche and gradually capture bigger chunks of the market. But to accomplish this astonishing feat, the business must be scalable from scratch.
What do we mean by scalable business? We mean to grow sales and profits without increasing costs proportionally.
How does it possible? After all, aren't expansion and investment closely linked? Not necessarily. For example, companies that work with bits, like IT startups and software powerhouses, become successful by taking advantage of scalable business models. These companies are experts in creating revenue streams without spending more on operational costs such as equipment and facilities.
Building a scalable business is not exclusive to digital companies. Far from it. Companies that deal with atoms can benefit too. With the help of automation processes, manufacturing companies, for example, can decrease costs and reach new markets even with a small core team and minimal infrastructure.
There is no secret recipe to building a scalable business. Every industry has its specificities that must be taken into account. Even so, there are some common steps that every company should follow regardless of the economic sector. Let's see them one by one.
Step 1 – Choose a niche market
The kick-start of your scalable business is to choose a market niche to attend. Focus on a specific segment with unsatisfied needs forces your business to build a value proposition and define a message.
How do you choose your niche? You need to analyze industry reports or run a market research study to collect data to help you understand which segments are more profitable. Take your time in this step and be judicious. Pick the one that shows the best growth potential and fits your brand's attributes.
Don't forget to take a lot at the competition. Try to reverse engineering its strategy by asking the following questions:
- What is its offering?
- What are its strengths? And weakness?
- What are its consumers?
- Are they satisfied?
Step 2 – Define a business model and set your digital marketing strategy
After choosing your niche, it is time to define your business model. In other words, how your business will be sustainable. Internet and new technologies opened up a range of possibilities for expanding enterprise models and attracting customers. Marketplaces and info products are two common examples, but the list is long. In this stage, keep in mind who your segment is and its daily habits.
You may have created the most innovative business model in the world. But without a well-designed strategy to set it in motion, it is nothing more than a good plan. So, start to define your goals and how you will accomplish them.
Pose yourself the following questions:
- Should I use social media to build a community? If so, on what platforms?
- Do I need to invest in ads to generate traffic to a landing page?
- Should I bet on valuable content through a blog?
Step 3 – Launch a Minimum Valuable Product and adjust the product if necessary
Finally, the last step is to launch a Minimum Viable Product (MVP). An MVP is a simplified version of a product or service to be usable by early customers, who can then provide feedback. Launching an MVP is an excellent idea because you get invaluable feedback about your product from real people, and it decreases the risk of financial failure. In a nutshell, launch, learn and adjust.
Building a scalable business is hard, but it rewards diligent entrepreneurs. With the outline of the basic steps, we hope you are in better condition to start expanding your business idea.