My client wanted to

scale her service.

It was a membership

type service and so it

was fairly easy to do.

She got all the

foundations set

up correctly.

She added as much value

into the membership

as she could.

She showed up

consistently and

she put a marketing

strategy in place

that would enable

her to scale.

Contrary to popular

opinion shared across

social media, you do

not have to scale just

because everyone does

it or is allegedly

doing it doesn't

mean you have to.

Right?

Right.

Scaling and growing,

they are often

used in business

interchangeably.

Oh, I'm going to

grow my business.

I'm going to scale

my business, et

cetera, et cetera.

they're a bit

different for three

different reasons.

And I did a podcast

episode on this a

little while ago and

you all loved it.

So I want to just

delve a bit deeper into

this situation, right?

So scaling, scaling

focuses on increasing

revenue without

corresponding

increase to resources.

Yeah.

So your resources

don't actually

need to change.

The goal is to achieve

more

with

less.

So using existing

resources more

effectively or

leveraging technology,

, and processes to handle

greater volume, which

is why a membership

is perfect, right?

Growing generally

means more staff.

Or more offices

or more stores

or more products.

More, more, more, more,

more, depending on

what the business is.

And just because

everyone talks about

growing or scaling

or making it more

attractive for

investors, when you

decide to sell, you

need to decide, is

this actually the

right thing for you?

When I think

about growing.

I think about

organic growth.

When I think about

scaling, I'm like, do

I actually want that?

And so you have

to ask yourself

those questions.

I have people that come

to me and want me to

help them to scale,

but they don't have

the foundations set up.

They don't have the

systems in place.

They don't have

the processes.

And without all of

that, it can be very

difficult to scale.

Well, Here's a

breakdown of the key

differences that I

see between the two.

First of all

is resource

allocation, right?

In growing, we

typically, uh, involved

a proportional increase

of resources, such as

capital or workforce

or operational capacity

in some way, shape or

form, along with an

increase in revenue.

So for example, you

might want to double

your revenue, but you

might need to double

your workforce or your

production capacity

or your marketing

efforts in scaling.

Scaling focuses on

increasing revenue

without corresponding

increase to resources.

So the goal is to

achieve more with

less always using the

existing resources

that they have more

effectively leveraging

technology and

processes to handle

the greater volume.

Efficiency Sometimes

growth can be less

efficient because

it often involves a

linear expansion , of

resources and costs.

And the focus is

on expansion, which

might lead to higher

operational costs

and complexity.

In scaling, the

emphasis is always on

efficiency

and

sustainability.

It aims to increase

revenue and customer

base while minimizing

all the costs.

So when people talk

about fixed cost,

your cost base doesn't

change if you're

scaling, the cost base

stays the same, which

means you can scale,

which means you can

have greater revenue

and greater profit by

scaling that thing.

And then the third

thing is strategy

and implementation

, in growing, those

strategies might

include hiring more

employees, opening new

locations, increasing

production, , or

expanding product

lines or service lines.

It's more

straightforward to

increasing size and

output of the business.

In scaling, it requires

strategic planning and

innovation to handle

increased demand

without proportional

increase in costs.

And I'm going to

give you a couple of

examples at the end

of this of both of

these things, right?

Now we're talking

about scaling and

that might increase

developing scalable

business models,

using technology

to automate tasks,

improving processes,

and finding ways to

deliver products or

services to a larger

audience without

increasing expenses.

It sounds lovely and

it sounds like Nirvana,

but I can tell you that

a lot of work that

goes into the scale

side of things, right?

And if you have a idea

and you immediately

want to scale, you've

got to get all the

processes right

first, before you

can think about that.

I want to give you some

examples of growth.

So a restaurant opens

new locations to serve

more customers, doubles

its revenue, but also

doubles its cost for

rent, its cost for

staff and supplies.

Yeah, that's growth.

One of my clients

is doing very well

in allied health,

in the allied health

space, and she wants

to grow to other

parts of Australia.

All well and good, but

we need to make sure

that the foundations

are there and sorted

and replicable when

she's ready to go.

And she can do that

with ease, right?

Two examples, two

scaling examples.

One that we can all

wrap our heads around.

A software company

automates customer

support with AI.

How annoying is it?

Just saying, unless

it's really good, which

allows it to serve

more customers without

hiring additional

support staff,

thereby significantly

increasing revenue

with minimal cost.

Closer to home, you

may have a service

that you sell that

is one on one.

And in order to scale

it, you move everyone

into a group program.

Or you create a

membership so that

you can scale that

when you're ready.

As you're sitting

there, and thank

you for joining me.

You're awesome.

As you're sitting there

listening to this or

watching this, what

are your thoughts?

Are you wanting

to grow?

? Are you wanting

to scale?

And then my question

would be, why?

Why do you want to do

either of those things?

Sometimes the

simple questions

are the best, right?

I think.

Understanding the

differences between

scaling and growing

helps you work out what

the right approach is,

what resourcing you

need, what marketing

you need, what the

conditions look like.

Scaling is often seen

as, , The unicorn,

you know, a more

sustainable way to

achieve long-term

growth or focusing

on maximizing

efficiency and

leveraging technology

and innovation.

But there are a

few other reasons

why you would and

wouldn't do it.

So I've got kind of

three reasons I wanna

talk to you about.

First, about scaling.

So this is for you if

you're thinking, yep,

I've made a strategic

decision, I wanna

scale my business.

Here are a couple of

reasons why you would.

It increases

market demand.

Obviously, when there's

a growing demand for

your product or your

service, scaling your

business allows you

to meet that increased

demand effectively.

And by expanding

your operations or

your services or your

business, you can serve

more clients, enter

new markets and enhance

your market presence.

What's not to love?

It does not only helps

in capturing a larger

market share, but

also positions you

as a leading player

in the industry.

greater revenue and

profit potential.

So remember in our last

episodes, we talk about

revenue being the top

line and profit being

what we get to keep.

We want that

profit to keep.

You can get both of

those things in growing

and you can get those

things in scaling.

Scaling can

significantly boost

your revenue and

your profit margins

because there's no

extra costs, right?

So by increasing your

production capacity

or expanding your

service offerings can

generate more sales and

improve profitability.

Economies of scale

often come into play

where there is a

cost per unit and it

decreases as production

increases, leading to

higher profit margins.

And this financial

growth can provide the

resources needed for

further expansion and

further innovation.

My third one is

competitive advantage.

Scaling your

business can give

you a, an edge.

In the market,

can't it?

We see lots of

businesses, especially

smaller businesses who

are trying to scale to

reach more audiences.

They've almost, almost

run out of time.

And so they're

forced to scale.

Not such a bad problem

to have just quietly.

Uh, Larger businesses

often have more

resources to invest

in the research and

development phase,

marketing and customer

service, which can

differentiate them from

their competitors and,

and larger businesses.

can attract top

talent, leverage better

deals with suppliers

and enjoy greater

brand recognition.

So all those factors

kind of contribute to,

yeah, let's do this.

But I don't

think that's the

full picture.

And I don't want

you to go, Oh yeah,

that sounds great.

I'm going to scale.

So I think there's

probably three things

that you might want

to think about.

As you think

about scaling.

One, risk of

overextension.

So scaling a business

requires financial

investment, extra

resources, extra

time, extra cash.

If the business isn't

ready, scaling can

lead to overextension.

It strains your

finances, your

processes, and your

systems, and the

workforce is broken.

potentially drawn

too thin and might

dilute the quality

of your product

or your service.

So the risk of growing

too fast without

a solid foundation

can lead to a whole

stack of things.

Customer

dissatisfaction,

operational

inefficiencies and

business failure.

And we see that all

the time with people

just trying to grow

a bit too quick.

The second one

is maintaining

quality and culture.

As a business

grows, maintaining

the same level of

quality and products

or services can be

really challenging.

Unless you're a

McDonald's, right,

where it's like

you've got the recipe.

You make it

exactly this way.

Bang, bang, bang.

But they've got

their systems and

their processes

in place, yeah?

And so, , you need

to make sure that the

The company doesn't

skimp on quality just

because it's scaling.

And also culture is

really important.

It's really important

to small businesses

and culture can be

harder to preserve

and rapid, uh, Growth

can also lead to

loss of personal

touch with customers

and employees.

It's almost like

you get promoted and

then you don't get to

speak to the people

on the floor anymore.

So there could be

a disconnect from

the values and the

practices that you

first put in place.

So we have to work

really hard on that.

And then the third

one is market.

And economic

uncertainty,

I certainly have a lot

of clients who know how

that feels, but scaling

a business often

involves entering new

markets or investing

heavily in new product

lines continuously,

both of which

carry risk, right?

Can't do anything

with risk.

Now I'm a risk

taker, so I'm kind

of okay with that.

I like to throw

stuff at walls and

see if it sticks.

but economic downturns,

changes in markets,

trends, increased

competition, they can

all impact the success

of scaling efforts.

And in uncertain

economic environments,

the potential

rewards just may

not be worth it.

So we have to have

our business hat on

when we're making

these decisions.

There's so much

to think about

when you think

about those risks.

And also the

payoffs, right?

Sometimes we go into

business and our

plan is to say yes

to money and to grow.

And that's okay.

Sometimes we go

into business and

we want to create

something that we

know we want to scale.

And that's also okay.

Just go in with

your eyes wide open.

What do you think?

Are you in scale

mode or are you

in grow mode?

I would love you to

drop it in the comments

for us or send me a

DM and let me know.

Thanks for listening.