Many startup companies think they need to scale up quickly to achieve success, but this is actually one of the biggest mistakes you can make. Starting out big is not going to impress anyone if you do not have the clientele to support the expense of it. Each and every business, no matter what their eventual goal is, needs to start by thinking smaller and aim to master their craft with their loyal customers before they can adequately grow.
This tactic requires some discipline which, in turn, will allow you to learn about the impact and value of the trade offs you need to make in order to keep your simple company afloat. Once you gain this understanding in a simpler setting you can begin to add to your groundwork here and there and measure the benefits.
Keep in mind, with a tight hold on the few resources you have, you can maintain the highest profits margins. Once you get really big, there are way more possibilities for things to go wrong. Below we will be addressing the ways you can shoot yourself in the foot when you are only trying to get your business running smoothly.
We will also talk about the more effective approaches you can take, instead.
Don’t worry! It’s a lot simpler than you may think.
Rather than focusing on getting bigger faster, let’s fine-tune the simpler things.
The Scaling Mistakes Often Made
It can be thrilling when you start to think about your business taking off and skyrocketing to the stars, but scaling up is not an easy thing to do. The changes that are required to do so could end up seriously derailing your company in a way that you cannot come back from.
As you grow, be careful to pay attention to these factors and common mistakes:
Perfect your market before you scale.
Many business founders start to scale their startup before they have worked out all the kinks, believing those kinks will work themselves out on their own. Others scale up before knowing who their loyal customer really are and if their market has a sustainable demand. Scaling up before resolving such issues will only guarantee dysfunction. You must truly understand where your business fits in its market before you can capitalize on it.
Work with people you know you can trust.
Often times, you have to involve a lot of different people in order for your business to run. Dance studio owners may be dealing with landlords, investors, business partners, etc. It’s very tempting to accept help in anyway that it is offered, but you must be careful who you trust enough to get involved in the success of your business. These people should be the kind that you can maintain a long relationship with. As you involve each person, consider carefully how they will contribute to your company and the hopes you have for it’s future.
Maintain focus on building long term demand.
Business owners tend to worry way too much about the members rather than the tactics that they can instill in order to create consistency and longevity. Building up your long-term demand will put a firm hold on your overall success.
The danger of comparing prices with competitors.
If you focus too much on giving the better deal in hopes of drawing more people in your direction, you may let what matters the most slip through the cracks. What people care about most is that they are putting their money toward something of good quality. If your price point is low and the quality is lacking, many will be disenchanted and choose to look elsewhere.
Focus more on the value your customers are receiving, this way you can keep your prices reasonable and not have to worry so much about who you are competing against.
Adjusting management methods as you grow the managerial setup that you have for a smaller company, may not transfer over well if you greatly expand. The way that you keep everything running and organized must be ready to act to the changes that may come along with your growth.
Pay attention to obvious issues.
You cannot afford to let the things that are hindering you fall through the cracks. When you notice a cramp in your style, take care of it as soon as possible. It may cause some discomfort at times, but your business always needs to come first if you want it to last.
Smart Practices To Keep You Safe
Once your business has settled into a good groundwork, you need to find ways to maintain it. Instead of taking mindless leaps in hopes for large expansion, keep this rule of thumb in mind as you make your plans for the future.
Grow outward instead of upward. Usually people thinking of scaling up by gaining a lot as quick as possible. Growing outward is more reliable because:
- You are taking the things you already know are successful and explaining them. You already know the base of it works, so you have control over the growth process.
- This gives you time to be conscious of what isn't woken so you can learn from you mistakes. Scaling up too fast will make it very difficult to predict how your business will respond. This can make it so your lack of preparation actually disappoints people and ends up turning your customers away. Growing outward makes it where you can test each new step to your operation to make sure that it is only benefiting you and not taking away from your success.
- You can be more thoughtful with who you hire. Instead of hiring a bunch of new people because you anticipate needing the staff, wait until your numbers justify bringing on more people. You should be hiring people only because you have a need for them and then you can assess further the way they will contribute to the company.
- You will need to accept that you may be a little short handed in the beginning. Still, it is better to learn exactly what it is that you need instead of finding yourself under a pile of debt and unsure when to make the first cuts in cost. Start small and add slowly. Know what it is that you are looking for and you will think in a smoother fashion.
Tactics You May Consider To Expand Your Studio
As you begin to wonder how you may want to “grow outward" instead of hiring a bunch of new staff, consider options such as the following:
- Offer free registration for people who sign up before a certain date.
- Provide discounts to members who bring a friend along.
- Provide special discounts for girl scout troops.
- Offer discounts for events, such a birthday party or for school socials.
- Contact a local paper or magazine to see if they will write a special on your studio.
- Offer a new type of class that may expand a different array of students/interest
- Offer coupons to families who helped a certain number of friends come on board.
- Post fliers around town at schools and churches that include a free trial class or first week of classes.
- Run an ad on Facebook that links back to your website.
- Make your website easy to navigate with a schedule of classes and a clear way to register by the click of a button.
How Studio Management Software Can Help
If you want your business to grow you have to know that you have a sturdy base to rely on. All of the basics need to be running smoothly so you are the able to build on top of your solid foundation. Instead of adding more staff to give a sense of security, you can maintain full control on your own by using a software that keeps a lot of your ducks in a row.
You may feel as though the workload is too much for one or two people to handle, but here are some things studio management software will help you keep track of:
- Accounting needs (basic bookkeeping, tax filing, tax liability estimates, and keeping track of deductions)
- Inventory management (software can keep track of the items that you have in stock and how much money you are making or losing on a month to month basis)
- Marketing and advertising (different outlets and updates on for particular internet interest)
- Easy enrollment and scheduling (the easier the enrollment process, the more the probability that people will sign up. You can also keep track of the most commonly attended classes and the ones that are only causing you to lose money)
- A place for feedback (you need to have an outlet for your community to give their two cents, this way you know what your customer base is really looking for and the different ways you can adjust in order to greater please your market.
At the end of the day, using software offers you a functional way to save money without losing any productivity. With this tool you are able to assess exactly which expenses are necessary and which are not.
More Myths To Be Aware Of
You should know that many of these common misconceptions of how a successful dance studio comes to fruition are based on popular belief. It may be tempting to fall into these traps because of deceiving ease, but they will only end up causing you stress and more work in the end.
More examples of such ideas include:
- It’s enough to rely on your passion for the craft.
- As the business owner you only have one job to worry about.
- make sure to offer a large range of products for your clients.
- When you find something that works, don’t stray into any other territory.
- your customers will come to you.
- You should only offer the coolest new trends.
- Focus mainly on your price point.
For more details on these myths and the facts that you should really be aware of, check out our ebook: Dance Studio Ownership 101: Facts, Myths, and Secrets to a Successful Studio.