A Cautionary Note
There’s no point pursuing growth for growth’s sake; you should scale a
business only if you really want to. Many of the subjects of our case studies
said they had turned down growth opportunities in a deliberate plan to
remain small: “I just didn’t want the hassle of managing people.”
The decision on going big versus staying small is unique to each person
(we’ll look at it much more in the next two chapters), but in this section we
want to focus on things you can do to increase income without hiring
additional employees or bringing in outside investors. All the tweaks
mentioned above can be done by a solopreneur. Some might be easier with
assistants, contractors, or employees, but none require a team. Before we
close it out, let’s look at a key distinction between two different kinds of
growth.
You can grow a business one of two ways: horizontally, by going wide
and creating different products to apply to different people, or vertically, by
going deep and creating more levels of engagement with customers. The
flowchart on
this page
shows how this works.
Different businesses will find that one solution suits them better than the
other, and it’s also possible to pursue limited growth in both areas. Mostly,
though, you can keep moving on up, tweaking your way to the bank and
growing your business. The first $1.26—or the first sale—may be the
hardest, but after that, your most difficult choice may be deciding between
many good options for growth.
KEY POINTS
“Moving on up” by increasing income in an existing business is
usually easier than initially starting the business.
By making careful choices, you can often grow the business without
dramatically increasing the workload, allowing you to scale without
hiring more people.
Easy growth options include adding a service to a product-based
business (or vice versa), deploying a creative series of upsells and
cross-sells, and making a few key tweaks.
Horizontal expansion involves going broader by serving more
customers with different (usually related) interests; vertical
expansion involves going deeper by serving the same customers
with different levels of need.
*
I’m grateful to Sonia Simone and Brian Clark for a discussion and
helpful tips on this topic.
†
Corbett Barr maintains a helpful (and free) set of resources on building
traffic at
ThinkTraffic.net
.
‡
John Jantsch wrote a great book called The Referral Engine, which is
all about creating a systemized process for encouraging referrals. Highly
recommended.
§
A little-known secret at Zappos is that they do cut people off who
abuse the generous return policy. CEO Tony Hsieh explained to me that if a
customer blatantly takes advantage of them—returning worn shoes on day
364 of the 365-day return period, for example—they’ll honor the refund
once, but they’ll also gently advise that customer not to purchase from
Zappos anymore. Fortunately, he also said, most people are honest.
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