Business owners love to see their business grow, not only for the income but also because they enjoy serving a larger community. But some businesses fail because they grow too quickly and can't react fast enough to unexpected challenges. That is why every business should understand scalability and have a reasonable plan for growth.

Scalability is the ability to handle changes. From a business perspective, it measures how easily a business can grow and stay profitable. Because making a profit involves many factors, including changes in customer demand, technology, and available resources, scalability is a vital part of business planning.
As a general rule, companies that sell mass-produced products are more scalable than those that focus on a specialized product or service. For example, a doctor will have less opportunity to automate than the owner of a modern shoe factory. But you should keep in mind that new technology makes it possible for even small, niche businesses to scale up. Figuring out how specialized your business is can help you estimate how it can grow.

Not every business can scale up safely. It doesn't matter how easy it is to streamline production or cut costs if the market doesn't support it. A lack of demand, resources, and ability to diversify into new markets are all factors that prevent a business from growing. Of course, businesses don't always make the best decisions, and some fail because they are too ambitious. Always take these factors into account when creating a scalability model for your company.

While scalability is an important factor, it isn't vital. Many businesses succeed without any scalability planning at all. If you focus too much on scalability, you might forget the purpose of your business: creating a product or service people want to buy.

Many entrepreneurs will tell you that they only thought about scalability when they had to, and there is nothing wrong with this approach. That doesn't mean, though, that proactively thinking about scalability is a mistake. Creating and updating a scalability plan is usually easier, and cheaper, than rushing to finish one before a deadline!

Businesses should grow, but they should do so at their own pace; no two businesses are perfectly alike, and each one will expand differently. The trick is finding the ideal growth rate for your company. After that, you can plan, so the transition to a larger customer base goes smoothly. Just remember that scalability isn't an exact science, and it makes sense to have contingencies as part of any growth strategy. And be sure to work with your managed IT services provider to ensure that your technology is setup to handle the scaling and not be a cause for any unforeseen setbacks.

If you’d like to talk to our vCIO about your plans for scaling, contact us today!