At some point, every successful manufacturing business owner will consider expanding their operations. Once a model is proven, there is no reason why not to take it to the next level.
Scaling is a scenario where a business makes sure all aspects grow at the same time. Say for example, you ran a large advertising campaign which brought you a significant increase of customers. To scale your business means dedicating effort in other activities in order to be able to manage this demand. For instance, you might consider hiring more employees, buying new machines, or optimizing processes to improve efficiency levels.
What is the difference between growing and scaling?
Some may use the two terms interchangeably, but there are a few differences to note. Simply put, scaling is the more sustainable option compared to growing which has to do with the outputs of your activities, such as:
- Number of sales
- Number of customers
- Number of warehouses
When growing, there’s no focus on input, and essentially if you use the same tools to manufacture three times the amount of products, or the same number of customer support specialists to look after twice as many customers, you’ll soon be spread too thin.
When your business is growing you should always seek scaling possibilities. Invest in your people, the right machinery, and smart technology to sustain your growth.
Top Tips for Modern Manufacturers Looking to Scale
Manufacturing isn’t a boring, old-school landscape anymore. Modern manufacturers sell online, directly to consumers, via their own e-commerce websites or through marketplaces like Amazon or Etsy. They use special accounting and shipping tools, clever marketing strategies, and they partner with famous influencers. The manufacturing tech caught up with the modern world, so product-making businesses can now use smart manufacturing software to make informed decisions, optimize operations, cut costs, and minimize waste. This, in turn, helps manufacturers scale by becoming more efficient and improving productivity.
2.Set clear OKRs
It’s important to have a predefined plan for what you want to achieve when considering scaling your business. OKRs stands for Objectives and Key Results. It’s a strong method to set ambitious goals with measurable results, whether they are individually planned or in collaboration with other team members. OKRs allow you to track progress, align all stakeholders, and increase motivation within your company.
Without specific, measurable, attainable, relevant, and time-based goals (also known as S.M.A.R.T goals) a scaling move could quickly become chaotic and dangerous for a business, threatening the growth trajectory.
Scaling a business doesn’t come without challenges. Ambitious projects that significantly alter the way a business operates require a detailed risk analysis before being put into motion. You have to put every change that comes with scaling under a microscope and create different scenarios visualizing how your business will be impacted.
Being aware of the potential risks puts you in a strong position with pre-emptive measures in place. Then you have to decide whether the risks that come with scaling a business are worth taking.
In essence, it’s important to minimize the complexity of your manufacturing processes. This means that scaling shouldn’t put too much pressure on redefining your entire production. It goes without saying that you shouldn’t even consider scaling your business if you don’t have a smooth manufacturing process in place.