Business Growth and Scaling are Not the Same Thing
Here’s how to tell the difference
I hate seeing poo-rus use a business term in their marketing without knowing what it means. It confuses new business owners. Take SCALE for example. SCALE does not mean the same thing as GROWTH.
These terms are NOT interchangeable; they are quite different and have unique and occasionally interrelated implications.
Growth is linear — an upward trajectory as in more clients, products, revenue, sales, employees etc. in comparison to a past point in time in the history of a business, product, program or service.
Whereas a product/program/service or business that scales can handle significantly higher sales, clients, service and support volumes with little to no incremental operating cost to generate higher revenue without impacting quality of product/service/program delivery.
If a business grows its revenue by increasing operating cost at the same rate or higher, it simply does not scale and can’t sustain profitability.
By contrast, a business which increases revenue significantly while keeping operating costs the same or minimally higher and maintaining or improving quality and service levels scales extremely well.
A scalable business is one that can MAINTAIN OR IMPROVE profit margins while sales volume increases.
By nature scaling is geometric and has an exponential positive impact on the business and bottom line.
Scaling too early or too quickly can do irreparable harm to your business. And rapid growth in a business that doesn’t scale can put you right out of business altogether!