Scalability: Do Not Start a Business that Is Not Scalable
Most people love to have their own business, because they are fed up of the job they have. They work long hours and make less than what they expect. Therefore, they think if they start their own business, they will have at least two advantages. First, they will be their own boss. Second, they will have time and money freedom.
These are all good expectations from your own business, but they can be met only when you don&8217;t become the prisoner of your own business. I mean there is no point to leave a 40 hours per week job to work 80 per week on your own business. Yes, you will be your own boss, but you cannot allow yourself to take a day off because the business stops if you do.
The reason of running a business that imprisons its owner is that most people don&8217;t know the difference of a job and business. They think they have a job when they work for someone, but they will have a business if they work for themselves. So, they will be happy when they start a business just because they don&8217;t work for someone else and they have no boss. But sometimes such a business is a lot worse than working for someone else.
So, here is the most important difference of a job and a business:
In a job, you trade your time, attention, and energy away for money. In a business you make your money work hard to make more money.
When you don&8217;t know this, you leave your job and start a business that resembles the same job except it has no boss. Having no boss is a good advantage, but it doesn&8217;t matter when you become the salve of your own business. Having a boss is a lot better than having such a business.
Am I against starting your own business?
Absolutely not. What I am trying to say is that before you run a business, you should learn how it has to be exactly. Here is what you must do:
You should setup a business that works on autopilot and without your presence. Only a slight supervision from your side should be enough. You should start such a business, if you want to start a business.
Warren Buffet owns 100% ownership of 43 major companies (read this). Do you think he refers to each company every day to manage everything? Is that really possible? Absolutely not.
Now you know why most business owners suffer and fail. One of the most important reasons is that they don&8217;t know what a real business is. They have started a business that is their prison. They don&8217;t know how to setup and manage a business that works automatically.
So, before you start a business, just learn not to start a job that has no boss, instead of running a true business.
Is it really possible to run such a business?
Yes, it is, thanks to the Internet.
While even franchise businesses that are the best examples of the successful business models, don&8217;t have such a feature, and as a franchisee you have to work hard to manage your business, it is possible to start an online business that is even more successful while it doesn&8217;t have the hassles and headaches of the franchise businesses, and above all, it 99% works on autopilot. Read this: Following a Proven Business Plan Is the Success Key
Another big difference of a job and a business is that a job is not scalable but a true business is.
What is scalability?
According to Wikipedia:
Scalability is the capability of a system, network, or process to handle a growing amount of work, or its potential to be enlarged in order to accommodate that growth.
That is a very important difference. It proves that most businesses are not business and they are just boss-less jobs. It means the only difference they have with a job is that the business owner doesn&8217;t have a boss and he is his own boss as the business owner. But the business is not scalable.
Most business owners work so hard to start a business. Only less than 10% of them are lucky enough to make the business profitable or breakeven. But even those who become profitable, have to struggle so hard to keep a constant profit. They cannot expand, grow and increase the profit.
Maybe you say that this is still better than having no business. But there is something that you didn&8217;t consider here: A business that can only have a constant amount of profit, will fail if the business owner slows down, or when a stronger competitor comes. I mean it cannot survive and will have to be stopped sooner than later. Either the business owner will get burned out because of working hard, or a stronger competitor comes and attracts all the customers.
Maybe you have a business which is not scalable, and so it is not a true business indeed. It is a different version of job. Be careful if your business is not scalable and you have a constant amount of monthly profit. Don&8217;t be happy with such a business. Either make it scalable or run a scalable business before your current business goes down.
Also, if you are thinking about starting a business, you should think about its scalability first, whether your future business will be scalable or not? There is no point to spend time and money on starting a business that is not scalable because it will fail even after becoming profitable.
Restaurants are the best examples of the businesses that are not scalable. The lucky ones can cover the expenses after a while and make some profit. But after a while of promoting and advertisement, the profit reaches its maximum level and doesn&8217;t increase anymore. A restaurant with, for example, 12 tables, has a limited capacity and cannot make money more than a special limit.
However, the restaurant owners who are talented enough, create and promote a brand. Once the brand become famous, they establish more branches. This is how you can scalable a business that is not scalable at the beginning. Being happy with a fixed profit ends up to bankruptcy.
How many of the restaurant owners are lucky and talented enough to scalable their business the way I explained above? Maybe even less than 1%.
Over 90% of them close the restaurant after a while of struggling and losing money. Less than 10% of them can cover their expenses and become profitable after a while. But many of them cannot keep going because of the new competitors. Only some of them keep making profit for some time, just because luckily no strong competitor starts a restaurant in the same area. But they are always at risk.
This is the limit that physical businesses have. But the Internet has made it possible to start the online businesses that are 100% scalable. The more people turn on their computers and start using the Internet, the more money the scalable online businesses make.
Of course, not all of the online businesses are scalable. Many of them are like physical businesses, but they just use the Internet to offer their products and services. Selling through the Internet doesn&8217;t mean that the business is scalable.
Learn more about the automated and scalable online businesses that give you money, time and location freedom: