#71: How to Know Your Business Is Ready for a New Offering
Many entrepreneurs see a new idea as an opportunity to jump in, get the head start before somebody else thinks of it, and implement it so that they can sell it as quickly as possible.
With very low barriers to entry and new ideas coming out by the millisecond, there are already more fresh products and services that you want to bring to market then you typically have time to implement.
So how do you know that you and your team are ready to try something new?
How do you make sure that you don't become a victim of the dangerous side of business growth.
Make sure to tune into this podcast to find out!
Check out my free training on www.yournextmillion.me, where several of my seven figure clients and colleagues share what they're doing in the next year to scale their businesses to the multi-million dollar mark and beyond.
Listen to the Show:
Laura (00:00):
When do you know that you and your team are ready to try something new? Faced with very low barriers to entry and new ideas coming out by the millisecond, there are already more fresh products and services that you want to bring to market then you typically have time to implement many entrepreneurs, see a new idea as an opportunity to jump, get the head start before somebody else thinks of it, implement it so that you can sell it as quickly as possible. But in the traditional business world, where I spent most of my career, there's a phenomenon to consider called dangerous business growth. In the online space, this is rarely considered programs. Go flying out the door as fast as they get reeled back in with very little consideration for how that impacts the customer experience or the reputation you have with your audience. The ability to sell to them in the future short term gains are often prioritized over long-term wins, decisions made without the true introspection of what is needed when bringing a new offer to market.
(00:59):
But if you really look at the big winners, who they are in the online space, it's that consistency, dedication, and commitment to the long game, layered with timeless strategic business decisions that tends to appear as though overnight success has been had. Stretching too far too fast is very, very common amongst enthusiastic online business owners, particularly eager for growth, but the ramifications can be great. It can bring on massive stress for company management, employees, potentially compromise customer fulfillment and product quality. And when you message and how you message is critical and the noisy online world, and it can create tons of customer confusion. Eventually your audience begins to tune you out because there's too many offers within too short of a timeframe and they simply stop listening.
(01:55):
So many entrepreneurs, dream of living a life of massive impact by creating a mega successful company, but only a tiny percentage of businesses actually scale to that point. And when they do it is so often lacking the very joy and freedom that got them into entrepreneurship in the first place. So on this podcast, we speak authentically on what it actually takes to scale your business in a way that creates freedom and joy that works for you, your team, and the incredible impact that you are meant to make in the world as a visionary entrepreneur. My name is Laura Meyer and I'm your host. I'm a serial entrepreneur wife, mom, to three. And I love talking all things business, especially digging into what it actually takes to scale joyfully to the multi-million dollar mark and beyond let's get started.
(02:46):
Let's start with a story. In 2012 Kind Snacks was founded by Daniel Lubetsky and at the time he had a very simple, yet dangerous growth plan. Get the revenue in as absolutely fast as possible, only investing in activities with an immediate ROI. He expanded quickly-too quickly. Daniel invested all of his revenues into expansion and took on huge orders that were impossible to fulfill. Customer satisfaction. Plummeted as orders were canceled and Kind Snacks was on the verge of bankruptcy. This was a huge wake up call for Daniel as he switched gears quickly and a place of overselling and under-delivering and seeing returns and declining cash flow. He was at a make or break moment in his company. Daniel wisely moved from placing all of his emphasis on expansion, taking those big orders to increase the sampling and quality control budget for the kind bars from just $800 to a huge $800,000.
(03:46):
Looking back Lubetsky says he wished he understood the benefits of product sampling and quality control on his fulfillment first measuring product market fit, taking time to make sure that he had the right offer in front of the right audience. And in the early days, sampling was a huge part of what was missing in their strategy because he viewed it as an expense versus an investment. For the online world, This would be the equivalent of a backend fulfillment, level of coaching quality of the program or overall customer experience. Daniel viewed it as something that would just slow him down instead of realizing that it was the wisest thing he could do in order to expedite growth in the long run, he could have potentially benefited from taking the time to research the perks of sampling and discovered for sooner that this was the company's secret to success.
(04:33):
It took Kind two years to develop a dark chocolate and sea salt bar, and they could have rushed that development to get it to hit the shelves as soon as possible, but taking his hard lessons learned Daniel invested in making the very best chocolate and sea salt bar on the market, making it a category bestseller. He said, we could have probably launched it in about six months, but we did not want to go backwards and over promising and under delivering. This would have risked launching a substandard product that didn't reflect the rest of the brand's ethos or the quality of what they were selling. And then there would be potentially lost new customers that tried the substandard product before testing anything else that the company had to offer. So for many of us, it's not uncommon for businesses to be that excited about growth, to just launch something and accept that, or even create some new challenges that were not equipped to handle this could mean taking on some new clients, even though you lack the resources to actually meet their needs and deliver on the promises, launching a product before it's ready to go to market or forcing a product to be market ready before you've actually observed people utilizing it and seeing what their secret to success is realizing the product can't be purchased sustainably or ethically or produced in a way that is honorable to your values might be the equivalent of stress on your team, or launching hard into a fragile market.
(06:01):
Many people who don't necessarily have the resource to invest, but you force them to anyways, because of sales goals, it might be taking a loan without necessarily knowing how you're going to pay it back or employing more staff than you really require or can even afford to pay. This can mean taking on anything that is larger than what you need or expanding into unfamiliar territories, starting a whole new division of your company That's product based when you know nothing about e-commerce or failing to account for overhead costs that increase disproportionally in relation to growth. This results in a lot of time in cashflow shortages, and really your attention being pulled off of your best opportunity, which is currently for most of you, what's working really, really well right now. And it can also just cause you and your team unnecessary stress and potentially result in having to lay people off.
(06:53):
And other words, premature growth can be bad for staff bad for you and bad for business. But of course, innovation drives everything for us as entrepreneurs, new ideas are the lifeblood of any company and it fuels our creativity as visionary. And it's critical for you to be able to, to innovate and be the visionary that you are so talented at. So what is the right way to go about growth? What filter can you look through when stacking up a new idea against its worthiness for yours and your team's attention? The first is to consider the capacity of everyone involved. It's critical to take on a new project, a new program, a new component of your offer when, and only when your senior leadership team has capacity. This means taking your current business and operationalizing it, creating SLPs, and then SOP for SOPs because at the senior leadership team in marketing sales and operations doesn't have capacity, but you layer something new on, it'll actually risk taking away from what's called your cash cow, which is the business that's actually paying the bills currently.
(08:00):
And if your senior leadership team does not have people underneath them, that can run the day-to-day of the cash cow and you move on to something new, you could end up decreasing revenue instead of increasing it with your new idea and a cow without cash, similar to bringing in a new baby in the house. When you already have existing children, think existing children need time, attention, and care. And the younger they are, the more help they're going to need. So it may be that that new baby has colic may be that they sleep well or that they may not. That new baby or new business may have health conditions. They may just need lots of time and attention. They may have a funnel that works or doesn't work. And that's very much what a new business or idea does because you need that capacity to figure things out.
(08:46):
Rarely are you going to launch something that is going to go exactly the way you think it will. The very first time there may be fulfillment issues that you thought of, or maybe it won't sell as well as you thought, initially, maybe you need a totally new funnel for it. You may have to spend lots of money and time trying to get it to become profitable. As is the case most of the time when you first running any type of paid traffic. So it's incredibly important that you have bandwidth and not only cash resources and infrastructure, but leadership bandwidth, when starting something new, you should be at a place in your company where the founder visionary and those senior level marketing leaders have extra capacity to experiment and learn. The second way you know, you're ready is relevance and the ability to place it appropriately, relative to other offers.
(09:36):
If it's a natural extension of something that people are already purchasing from you, it makes the most sense. So it is a natural ad-on or something that you can easily put onto the backend. I'm personally such a fan of building out programs, services, and offers on the back end of an existing offer. For example, maybe a mastermind at the end of a course or a coaching program at the end of a short term offer. It's so much easier to build out the backend of your Ascension before it is to build out the front end. That's usually when you can charge more and you have people who are already waiting for that next step of support from you, so that when you're creating something new, you can actually survey the people who are already in your existing program for the pain points that your current program may not solve, or an example of this next level problem that they will experience.
(10:23):
Once you're finished helping them with their current problem, this makes a no-brainer offer and makes it really easy to create something new, especially because that person already knows likes and trusts you because your current fulfillment is awesome. By choosing this micro shift and delivery, while maintaining the ability to stay relevant for your perfect client, this allows you to take new ideas and create a purposeful and well-thought out Ascension or customer journey. Finally, you know, you're ready for that new thing. When you've researched it, you've looked at it. You've talked to people who have a similar type of offering, and you like where it's going to take you from a lifestyle perspective.
(11:00):
This and only this is how you keep from building a business that you hate. Because a lot of times we end up bored. We end up restless as entrepreneurs. We ended up dissatisfied with something that's already working well because as visionaries, we're always excited about that next new big thing. What happens is that we have this whole grass is greener temptation, and really what we're looking to build. Isn't always what we actually want anyways. So for example, if you don't want to have a company with lots and lots of people don't choose a business model that requires lots of employees, many people might look at what's easy to sell, or what's trending. What they should be actually looking at is, well, what is my day-to-day life going to look like as the owner of this type of business. At the end of the day, the boredom or excitement around something new on the front end, simply can't take precedence over the potential for dissatisfaction or misalignment that can happen as a result of building a business that doesn't fit how you want to live.
(12:07):
So this difference here between a great idea that should be pursued and just a plain old great idea, experienced entrepreneurs know wise entrepreneurs know that not every great idea should be implemented. They should be run through a series of filters, including does it align with your mission vision? Is it going to take you where you want to go in the long run? Do you like the actual day to day of the idea that you're about to implement? Will you enjoy delivering on this? Or do you have a key partner who could deliver on it with you so that you are either not falling short on fulfillment in a business that you actually don't even want to be in? Wise entrepreneurs know that great ideas come every day and that there's no scarcity of what could be next. And just because you don't do something doesn't mean that someone else will. And then all of a sudden you'll regret it as entrepreneurs. Sometimes we have this huge fear of missing out on some big idea, and then we don't even know whether or not it's right for our business. That's why we have to proceed cautiously and only take on something major when we already have the capacity and love where that idea could grow into, because it's not actually the strategy or how good an idea is that makes it work, but really great implementation of that new idea and how delivering it makes you feel.
(13:28):
Hey there: before you head out, I want to let you know about a free new training I have right on a brand new website called yournextmillion.me. It's yournextmillion.me, where several of my seven figure clients and colleagues share what they're doing in the next year to scale their businesses, to the multi-million dollar mark and beyond. And I have to tell you, it is not what you think. So check it out at yournextmillion.me. And if you loved this show, will you subscribe to it and share it with a friend or just say something nice about it to someone, you know? I’d really appreciate it so much. Thanks so much for being here and I'll see you next time.
The Scale with Joy podcast dives into the mindset and strategies of scaling your company to the million dollar mark and beyond. Each week, we follow the journeys of innovators, disruptors, experts and leaders - sharing behind the scenes stories of their most challenging moments and greatest lessons learned-all while building their multi-million dollar empires.