How To Prepare Your Business To Scale Exponentially
Hello, everyone, this is Sharon, and I'm here today with Steven Kohnke with Denver Business Coach. Hi, Steven.
Steven: Hi, Sharon. How are you?
Sharon: I'm good. I'm looking forward to hearing some great tips from you this morning that are going to help me with my business. So what are we going to be talking about today?
Steven: Yeah, so at Denver Business Coach we did some qualitative research, we asked business owners where their weaknesses are, where are their strengths and how are they showing up in their business. Through those responses, we've been able to shape a couple of crucial conversations and questions and tips, for these business owners to overcome some of these issues that they've all been experiencing.
Steven: And today we're going to be talking about the process of growing a business and where business owners think adding more services or more products to what they're already offering, is a great way to grow. As opposed to actually eliminating some of those and niching down for scaling a business.
Sharon: So great topic today. And, in a way, it feels a little counterintuitive, right? I think well, if I could just offer more, it will help me grow my business. That'll help me be more successful. Why is that not necessarily true? And why adding more products could actually hurt my business?
Steven: Yeah, that's a great point. And it's a fallacy, that most small business owners definitely fall into that trap of, "Hey, I can also do this, I can also do this. This is in line with what I have" and business owners when they start going down that path, they just start adding more on, without really perfecting what they already have going on.
Steven: So what that means is, they have a bunch of different services that they're able to offer a client and they keep selling to one client. But what can get lost in that is, if you are a marketing firm for instance, and you do websites, logo design, social media, you do print papers, you do designs, you do a whole breadth of things, sometimes if you don't have the right systems in place for each one of those offerings, things can fall through the cracks or things can be not up to par. You can fall short on some of those offerings.
Steven: And what ends up happening is, a client or a customer that came to you for everything actually ends up going somewhere else for a portion of that service because they can get it better somewhere else. So you actually, in the long run, lose more business. And in the short run, it looks like you're going from a revenue standpoint, but you're really not setting your business up for success by just continuously adding on to it.
Steven: It's better to perfect one piece of your business. Make that as consistent as you can possibly do it. And then, if it makes sense and you critically think about adding another service or product to do that, then do that, because you know that the one is already set and you can offer that to the best of your ability.
Steven: Now to scale. That's what's necessary to scale, you want to have something that's super repeatable and very reliable to sell to your target audience, when it's that what will become known, because that's high quality, that's high touch, that's what people are looking for when doing that. They don't want someone who's just throwing on a bunch of additives and saying, "yeah, we can do that, that too, that too, that too" that actually decreases the value of the business as a whole.
Sharon: So that being said, what does it really mean to be a specialist? And there's still like something lurking in my mind that I feel like I'm going to lose business if I'm not a generalist if I don't offer the whole shebang. Can you say a little more about that?
Steven: Yeah. Absolutely. There are times, there are certain industries where being a generalist is beneficial, but for the most part, I'd say a majority of businesses, it is better to be that specialist because when you are known as a specialist within your industry, there's no one better.
Steven: You are the specialist, you are the best at designing logos. You are the best at building a website that's engaging and is able to capture more leads and have more conversations. But if you're doing a wide breadth of things, to be an expert in every single one of those, there just isn't enough time in a day to be able to be that expert. So you end up actually delivering a subpar product.
Steven: When you're that specialist and you become known as that specialist. You are able to grow referral streams, which we've talked about, a little bit stronger finding "Ok, so I'm the person who designs a logo, but I don't design the website. But I do know someone who is a specialist in designing a website". So you strengthen those back and forth relationships as well. So that's one benefit of being a specialist as you can grow your business that way.
Steven: The other way is just for your target market to notice that you are the specialist on being a logo designer, for instance, that is word of mouth marketing, where the business that you delivered this absolutely excellent product, to this excellent logo, they start telling their other business buddies, "Hey, this person is amazing at designing logos. You need to talk to them".
Steven: If you were OK, kind of putting together a bunch of different things, then that word of mouth isn't going to be as effective. So it's much harder to grow a generalist business than it is a specialist business. It made sound and that's from a long run standpoint, to scale down your offerings, it might sound like you are actually declining what you're able to do and preventing your business from growth. But the long term play a specialist, has a better business, and can actually scale up much easier and much faster than a general business can.
Sharon: Thank you, Steven. And in a way, it's counterintuitive, but I trust your perspective. And in a long term game makes a lot of sense. So thank you. Any closing for us today?
Steven: So to learn more about how we are able to niche down, we help our clients niche down to scale up. You can just visit DenverBusinessCoach.com and we can have a conversation and talk about how we can do that.
Sharon: Thank you, Steven and great talking to you today.
Steven: Thank you, Sharon. Talk to you later.