Ever wondered why so many new businesses struggle? What if I told you that building a multi-million-dollar business could be simpler than you think?
Imagine a world where you can kickstart your dream venture with just 10 straightforward steps – and you can start right now!
In this article, we will discuss 10 strategies that can help you scale your startup to a million-dollar business. (If you’re just starting out with creating your new business, I’d recommend checking out our 40-step pre-launch checklist).
These tips are inspired by my own experiences and the experiences of other successful entrepreneurs who have been through the process of scaling a business. By following these simple strategies, you can avoid common pitfalls and increase your chances of success.
Before we get going, if you’re looking to build a product-based business within 1 year, I’d recommend watching Alex Hormozi’s great video here.
While some of the figures may be slightly out of reach if you’ve never started a business before, it’s definitely worth a watch for some inspiration before you keep reading this article.
The Core Of Growing Your Business To 1 Million Dollars
From my experience, there are 3 fundamental ways to grow your business no matter what stage you’re at:
- Acquiring more customers
- Increasing customer spending
- Cutting costs
While the ideal plan incorporates all three growth strategies, it’s important to keep things simple. When growing my businesses, I’ve found that it’s much easier to focus your efforts on one of these methods at a time, especially if you’re a solo founder.
Which one to choose first largely depends on your business.
For example, if you’re running a SaaS company with monthly subscriptions, boosting your purchase frequency would not be a valid option for you, meaning you either need to look into getting more customers or increasing your prices by offering additional functionality for more money.
So, dive into how you can improve all of these areas of your business.
Scale Your Business By Attracting More Customers
Attracting new customers to your business can be one of the most effective strategies for growing your business.
While it may sound like an obvious way to grow, it can actually be one of the most difficult things to get right.
From my experience, it’s easy to achieve the low 6-figure range on a single or a handful of similar marketing methods before growth starts to slow down. This means that in order to reach the million-dollar mark for your startup, you’ll need to find at least one additional marketing channel to bring in new customers that you haven’t reached before.
This can be quite a challenging and expensive endeavour for any business, as it essentially means researching more into your target audience and experimenting with new approaches to reaching them.
While I would recommend fully reading our complete marketing guide if you’re considering adding an additional marketing method to your business, I’ve created 5 tips here to help you get started.
- Evaluate Current Strategies: You should start by assessing the effectiveness of your current marketing strategies as this can help you identify what specifically grabs your target audience’s attention
- Competitor Analysis: Even if you’ve done this before, make sure to study your competitors’ marketing tactics. Companies are constantly changing their marketing tactics, so your competitors may have started marketing in a new way since you last checked.
- Customer Feedback: Gather feedback from existing customers to understand their preferences, pain points, and suggestions for improvement. You may find that your product addresses pain points for your customers that you didn’t realise, which could make for great new promotional material. Check out our guide to customer feedback loops if you’d like to learn more about this.
- Testing and Experimentation: Be ready to experiment. As with everything in business, some new approaches may work, and some may fail. Make sure to test your new strategies thoroughly with a small-scale campaign before heavily investing your time and money.
- Innovative Campaigns: Develop creative and unique marketing campaigns that resonate with your audience and set you apart from competitors. Check out our collection of 5 innovative marketing strategies if you’re looking for inspiration.
Increasing Customer Spending To Boost Your Revenue
If you’ve already got customers spending money with your business, it might be a good idea to work on getting your customers to spend more with you.
Increase Your Prices
The easiest option here is just to increase your prices. If you’ve not updated your pricing structure in a while, you offer much cheaper prices than your competitors, or you’re getting feedback from your customers that your product offers incredibly good value for money, you may be able to up your prices and get an easy increase in revenue.
It’s definitely not the only option here (more on that in a minute), but if you are considering updating your pricing structure, I’d recommend that you read my complete guide to pricing strategies here.
Incentivise Customers To Spend More
When you find yourself at your neighborhood grocery store’s checkout, enticed by the alluring magazine or chocolate strategically placed next to the cashier, you’re being tempted by an effective strategy aimed at making you to spend more. This is precisely the approach that you should consider for your own customers.
While this exact strategy may not necessarily work for you, especially if you run an online business like me, you can adapt this premise to work with your business. Take a look at my 5 tips for incentivising your customers to spend more:
- Study Customer Buying Habits: Analyze customer behavior to identify trends and patterns. For example, if you notice that 2 products often get bought together, bundle them into a deal or move them physically closer together.
- Use Limited-Time Offers: Encourage immediate purchases by incorporating phrases such as “Order now!” or “Sale ends soon!” into your marketing messages. Limited-time deals create a sense of urgency with your customers, prompting them to take action before the deal runs out.
- Offer Subscription Services: Subscription services are great because they create predictable, increased income for you, while also providing a reliable service for your customer. If you’re not already offering a subscription, explore whether this is a potential for your business.
- Create a Loyalty Program: Capitalize on customers who are seeking a bargain by offering a loyalty program. This will keep customers coming back for more as they’ll feel like they’re getting something in return for their support of your brand.
- Give Away Freebies: While this may sound counter-intuitive for helping your business scale its revenue, freebies can help encourage customers to spend more with you in order to qualify for the free product and as an act of gratitude.
While the other 2 methods that we’ve discussed so far have been focused on getting more money into the business, it’s also important to make sure your business isn’t leaking money. With new research showing that an average of 10% of business expenses are wasted, it’s important to make sure your spending the money you make effectively.
In my experience, it’s crucial to audit your business’ expenses at least every 6 months to ensure that you’re not wasting money on unnecessary contracts, services or staff.
Here are my 10 actionable tips for reducing your business’ expenses:
- Analyze Expenses: Review your financial statements in order to identify areas where your business is overspending or where costs can be reduced.
- Negotiate Supplier Contracts: Reach out to your suppliers and negotiate better terms or prices for the products or services you purchase regularly. If you’ve built a good relationship with your suppliers over time and are using them frequently, they’re much more likely to offer you a discount rather than risking you moving on to their competition.
- Outsource Tasks: Instead of hiring full-time employees, consider outsourcing tasks or projects to freelancers or third-party service providers. While they can seem more expensive per hour, if a role is not fundamental to your business it may be cheaper to outsource in the long-term.
- Inventory Management: If your business revolves around physical inventory, it’s a great idea to optimize this area of your business to reduce carrying costs. You can implement just-in-time inventory practices to minimize storage expenses.
- Cut Unprofitable Products: Evaluate the profitability of each of the products that you offer. If some of them aren’t making sufficient revenue, it might be time to discontinue them so that you can focus your efforts on the more successful areas of your business.
- Employee Training: If you’ve got employees, you may find investing in training and development programs improve their skills and productivity.
- Regardless of your business stage, focus on acquiring more customers, increasing customer spending, and cutting costs to grow your business.
- You should concentrate your efforts on one growth strategy at a time, especially if you’re a solo founder. The choice depends on your business model and goals.
- Attracting new customers is an effective way to grow. Continuously evaluate and experiment with marketing methods, study competitors, gather customer feedback, and create innovative campaigns.
- Encourage customers to spend more by revising pricing, offering incentives, studying buying habits, using limited-time offers, introducing subscription services, creating loyalty programs, and providing freebies.
- Regularly review and analyze your business expenses to identify areas where you can reduce costs. Negotiate supplier contracts, outsource tasks, optimize inventory, discontinue unprofitable products, and invest in employee training.
Now that you understand my 3 tips for scaling your startup to a multi-million dollar business, make sure that you’re complying with the legal requirements for your business here, and check out the top 10 business myths.