I have a simple question for you today. Is your business scalable?
A business that is not scalable will rarely, if ever, gain you the financial freedom you desire. Scalability is crucial.
So, what exactly is scalability?
As you probably know, if a business is “scalable” it can make more sales without dramatically increasing its expenses.
For example, the franchise model, like McDonalds or Subway, is difficult to scale. In order to increase their sales, franchisees need to find new locations, build brick and mortar restaurants, stock physical inventory, and hire new staff, just to name a few of the expenses.
It’s a strategy that CAN work, but it takes very deep pockets.
And when it comes to home-based businesses, you need to beware of a few things that will hold your business back and prevent it from scaling up.
Selling physical products. Physical inventory is expensive. You need to order it, pay to have it shipped, warehouse it, and pay to ship it back out. All of this costs money…and man hours. You can increase your sales only to a point. Eventually, you’ll be forced to rent more space or hire more employees to meet the increasing demand. Very expensive.
Selling low-priced, low-margin products. The difficulty in scaling a low-priced, low-profit product is that greater sales numbers don’t translate to greater profits.