What is a scalable business?

By
July 30, 2022

When it comes to buying or starting a business, the first thing that should be considered it whether or not a business is scalable, trying to grow a business is a mission it self, and then trying to scale it is another. To find out more about selling your business be sure to visit Nash Advisory.

In this article we will go over some business ideas and which ones you should go for, this businesses can be anything from storefronts, gas stations to even commercial routes, but before we do that likes go over what is a scalable business? 

A scalable business means a business that a business  is considered to be really scalable if it is able to maintain low marginal costs while simultaneously increasing revenue and operating effectively with minimal input from the business owner.

Here are some examples:

  • Commercial Routes 

Commercial routes are a simple business, you have a product or service or items to be delivered and your task is to get the one of these to the customers, example if you buy a bread route your job is to take the order and deliver it to customers, with commercial routes it comes down to what are the best routes to buy

 Scalable? Yes 

  • Store fronts 

Store fronts can be scalable, if you running a business like a coffee shop, you should get a place with the rent not so high, the income of the business should be enough to cover the bills and employees, becoming scalable all depends on how busy the place is. A professional business plan consultant will help to make estimations and create proper cash flow and calculations. 

Scalable? Yes 

  • Software start up 

You came up with a great idea, the next facebook but trying to get it out there is the issue, you will need investors after investors, did you know uber is still taking investors and amazon took years and years to break a profit.

Scalable? Not in the beginning 

  • Manufacturing 

Manufacturing is a big business, this is next level up it requires a big warehouse, around 10,000 square feet, vehicles and lots of employees in order to scale a business like you need heavy contracts to keep you going this business is tricky as it can be great for a while then business can just drop

scalable? risky 

  • Shipping 

Shipping goods or products is a business that can be operated and scaled, the business grows you hire more staff that business slows down you cut down on workers and sell a few vehicle, your business grows as you get orders.

scalable : yes 

Conclusion:

Overall a business is about risk taking,thrive and determination, any business can scale as long as you do it right, some companies want to grow to fast and end up falling face first, its always smart to take baby steps and work your way up, dont hire more then you need and dont over market, marketing cost money and time, bottom link is if you are looking to buy a business that is scalable you should research when looking to the expenses if the business has to much going out it might be a red flag when buying a business  to stay away, and also keep in my mind do you want a business that will have you working in it 24/7.