In today’s business world, it’s possible that grit and determination can help you achieve the coveted 7-figure mark in revenue. But how to scale a business beyond this level becomes increasingly difficult without strategies and processes.
So the question then becomes, where must you make changes to create increasing and predictable profits within your business?
In many cases, when scaling 7- and 8-figure businesses, we see 3 primary issues:
- The company lacks predictability in leads or sales.
- The company is too dependent on the owner or a few key employees.
- The company is overly reliant on word-of-mouth and referrals.
Adopting scalable sales and marketing strategies goes a long way in fixing these problems. What’s unique about “scalable” strategies is that you can massively increase the output without a substantial increase in resources.
Keep in mind, though, that you can quickly derail these efforts when you compete on price or you often lose business to inferior competitors.
A big key to scaling beyond 7 figures is not focusing on growth alone. Because companies that grow too fast and aren’t prepared don’t last.
Scale Your Business with These 7 Steps
A Kauffman Foundation study found that 66 percent of companies listed on the Inc. 5000 fastest-growing companies list were either disadvantageously sold, went out of business, or shrunk in size within 5-8 years.
Why?
Because the right people and scalable processes aren’t in place to handle rapid growth.
Furthermore, greater growth requires better leadership. As the business owner or founder, your leadership skills must develop quicker than your company grows.
Often, this is why many top CEOs bring on a seasoned business coach who can help you develop a customized plan and provide a fresh perspective to increase the odds of success.
As CEO of Predictable Profits, one of my responsibilities is to help guide the growth of companies looking to push past 7 figures. We’ve helped over a dozen companies earn their spot as one of America’s fastest-growing companies (including one that went from $1M to $40+M within 6 years of working together).
Below are the 7 steps our clients take to create scalable and predictable growth.
1. Establish a Unique Advantage Point
Besides defining your business, your UAP highlights the most compelling reasons customers rave about you. What distinguishing advantage makes your company more appealing than your competitors?
Avoid relying on routine responses about a better product or strong customer service. These items are rarely compelling enough as a differentiator.
When we began working with a video marketing agency that sought to capture more market share, their target audience was too generic. Consumers are discerning and seek out specialists who are more likely to understand their problems and solutions.
After reviewing the agency’s best clients, the CEO decided to specialize in video marketing for attorneys. In doing so, he attracted more leads, increased prices and achieved 150% growth within 12 months, quickly establishing the agency as a market leader.
2. Multiply Momentum with Optimization
Optimization allows you to get more from what you’re doing without needing additional resources. So what can you do more of that’s working? Or, how can you get more value from your leads?
Questions such as these help determine gaps between what’s possible and what’s already happening in your business. With optimization, you can fill these gaps to find profits in overlooked places.
For example, we worked with an executive coaching company that was experiencing stalled growth and needed to break through the next level. We discovered they received, on average, 1,584 leads per day, but their sales conversion rate was low.
Revenue per lead was initially $7.20. After suggesting a few tweaks to their email campaign and landing pages, we helped increase revenue per lead to $46.09 within 17 months — a 540.13% increase without any additional ad spend.
Read more: Using Customer Insights to Drive Growth and Build Loyalty
3. Create Lead generation with Inbound and Outbound Marketing
Blending both outreach types helps produce predictable revenue. Inbound marketing is more passive — you distribute content as bait to lure in potential prospects. With outbound marketing, you initiate communication by reaching out to a targeted list of prospects or possible partners.
Remember, only about 3% of a market is ready to buy right now, while 6-7% are open to the idea. This leaves 90% of a potential audience that needs additional communication or information over time before you can convert them.
4. Maximize Sales Conversions
This is a way to increase revenue and lower customer acquisition costs. But it’s often overlooked because so many business owners believe they need more leads.
A lack of leads is a sign that a business is slowly taking on water. And rather than fix the holes, they want someone to provide buckets to bail them out. Not growing fast enough is never a lead-generation issue — it’s a conversion problem.
5. Boost Lifetime Customer Value
Now, before you can boost lifetime customer value, you must know how much a customer is worth to your business. Without this knowledge, you don’t know what you can invest to acquire a customer.
This being said, many entrepreneurs are so focused on bringing in new customers that they ignore opportunities to drive multiple sales through upsells, down-sells, and cross-sells — all of which increase your customers’ lifetime value.
6. Profit with Triple-Win Partnerships
With this business-to-business play, you create relationships with companies that already do business with your ideal customers. The triple win happens when you receive a referral.
- You get a new client.
- The company you partner with gets a small commission.
- The referred person gets a preferred benefit, bonus, or discount that isn’t available elsewhere.
This way the person doing the referring looks like a hero (and gets rewarded). The person who buys receives an extra advantage. And you pick up a new client.
Let me give you an example of how this works…
Most real estate developers sell a home and that’s the extent of their revenue. However, when I owned a real estate development company, we deployed a triple-win partnership by meeting with vendors such as home alarms, furniture, driveway seal coating, and home theater companies.
We asked them to give our clients a preferred discount not available to the public. For us, we requested a modest commission each time someone made a purchase. This resulted in the vendor winning a new client, the client getting an exclusive discount, and us earning a commission equalling thousands of extra dollars per month.
In fact, the triple-win partnership boosted profits so much that we were recognized by a top accountant as having one of the industry’s highest profit margins.
7. Develop Rapid Referrals
You need a program that inspires groups of raving fans to sell your product or service for you. Without one, you’re stuck relying on hope and luck for referrals.
Of course, you can set up the “triple-win” scenario mentioned above. People want to feel special, valued, and appreciated. So, whatever system you set up, work in ways to share rewards for referrals.
Read more: How to Make Sustainable Business Practices Part of Your Growth Strategies
More on How to Scale a Business
Hopefully, this article helped demystify the nuances around scaling beyond seven figures. As you see, you have clear steps you can take to position your business for that next stage of growth.
Now, it’s time to put these 7 steps into action. If you’re in ecommerce, our free Start and Scale course is the perfect place to start growing your business. The instructor, Gretta van Riel, has scaled 5 million-dollar ecommerce businesses, and she shares her strategies for success with you.
The post How to Scale a Business: 7 Steps to 7 Figures appeared first on Foundr.
