MICHELE (00:00) On the podcast today, we're talking all about growing your interior design, business and scaling. Isn't that a great topic to kick off the year? My hope is that by the end of the podcast, the idea of scaling is not something scary, but something that you feel like you can tackle. I remember the first time I was asked how I was going to scale my business, and honestly, it got a little irritated. In my mind, all I could think of was "Dang, I just started this business. Why do I already got to start thinking about that?" The truth is that earlier you think about it, the better. And so today, we're going to talk about the indicators that it might be time to scale, what scaling might look like, and hence it's not the same for everybody. And what are some actionable steps that you can take.

MICHELE (01:26) Scaling...The first time I was asked about how it was going to scale my business, it stopped me in my tracks. It was years ago. And my goal at that time, honestly, was just to get my stuff done and get through the day. And here is someone, I'm sure will get intent, asking me about growing my business. Stund is a really good way to describe my reaction and if we're being really honest, and why wouldn't we be right? I was a bit annoyed and I put up my defenses and maybe you've done that too. But as I continued in business, I started giving thought to what does it really mean to scale? What might that look like for me? And then I felt overwhelmed again.

There were some out there saying there was only one good way to do business and one way to scale…That my business had to look like ABC. And as I looked at that business, I thought, but that's not what I want. I want a XYZ business. And so then the more I kept digging in, I realized there is more than one way to grow more than one way to scale. Let me take you back to 2006. We had just found out that our youngest son was dyslexic, and he needed a lot of extra attention to help in school and in tutoring. He was in the third grade. And for me to help him like he needed, it was going to require a huge amoun...like a lot of my time, and that meant time away from the business. At that point, I was working during the hours that my kids were in school, but now I was going to have to take that time (while he was in school) chop it down, spend some of it preparing to help him and the rest of it working. And so as I sat and I thought about my work in that 2006 and 2007 school year, I knew that my hours of work had to be drastically reduced. And so as I started thinking through it and working through it, I decided to do something that was pretty audacious. I set a goal that I wanted to make the same amount of money during that year as I had in 2005, and six, but I only wanted to work half the time. And wow, to me, that was like a really big, hairy goal. But let me tell you, here's what it did. It forced me to look at my processes, my pricing and everything in the middle.

MICHELE (03:40) I started streamlining every single thing that I could, and then I started choosing only the best projects. So, if people called me with anything that would waste my time. I just didn't take it. And guess what? I did it! I met my goal. So in 2007, our son was then able to go to a school that specialized in the gift of dyslexia, and that gave me my time back. And then all of a sudden, I had double the time. Because see I had already cut my time in half and made the same amount of money as the year before. So now, I had this opportunity to scale my business, because I make good use of the other resources that I had and my time. So with that double time, I looked at it and thought, now maybe I can make double again.

MICHELE (04:26) Scaling in that scenario was all about getting my internal processes tightened up and ready. I didn't hire anybody that year. Instead, I use technology and tools that assisted me. I got very, very clear on my ideal clients and my ideal jobs, and I priced fairly and for value for everything that I was doing. To me, every moment counted, and I didn't have any to waste. And this one year, which could have been a terrible business year, I could have bemoan the fact that I was only having half my time to work. It turned out...I'm not even kidding you...to be the one year, in which I would tell you, that I probably learned the most in business. And that one year set the stage for the recession that was getting ready to come later that 2007 and 2008. And then a very weird turn of events, I continue to make more money during that time, due to all that hard work that I had put in place during 2006 and 2007.

MICHELE (05:25) Now in my business, it's not just me, I'm not a team of one. I have a team of more than 10 people, who helped me in many capacities - get the work done that needs to be done. We have implemented processes. We implemented technology and standard operating procedures, because I know I cannot do this alone. My company constantly invest in others to help us grow. And, again, scaling is not the same way I did it the last time. Just listening to these two examples, hopefully will free you up to know that there's more than one way to scale and grow your business. This is not a magic number of employees or contractors. Each business has different strengths and goals and the growth plan needs to match. So let's look at some indicators that it might be time to scale.

MICHELE (06:10) Number one, are you out of time to serve your clients? Are you finding that you feel like you are constantly running around trying to serve clients? Maybe even worse. You get people calling you now and they want to work with you now. They've got ideal projects and you have no bandwidth to say "Yes" to them. So you're either telling them "No" or you're saying "I can start with you and six to nine months." If you're doing that, that tells me that your business is growing like crazy. And having to tell an ideal client and an ideal project "No" or "Wait," might make you feel crushed or make you feel bad. I know a lot of my clients have talked to me when they're in this position. And they're like, "I want to grow and I'm not sure how" and "I feel like I'm failing at this." Listen, a small wait time isn't a bad thing. If we're under three month, there is nothing wrong with them thinking little bit of a scarcity model, you're very much needed. But when we start getting over three months, they're usually going to go somewhere else. I mean, I'm not saying they won't wait on you. But this is definitely an indicator that we've got to do something to scale the business.

MICHELE (07:17) The next would be, are you overwhelmed with all the admin duties? You know, we constantly have this barrage, I would say of emails and text and all these items running through our business...bookkeeping. I mean, just admin work that just seems like it duplicates at night, right? And it's very, very difficult to keep up. And so this may be an opportunity for us to hire and to bring somebody in. When we start a business, we really try to do it all. And then the business gets bigger and bigger, and we find that we can't do everything and grow. And then that precious time it's taken to do admin, when we really need to be working in a different capacity, as we'd like to call the Queen B role. And so then that actually hampers our business growth, because we're doing all these other things that really aren't the things we need to be focused on.

MICHELE (08:10) The third indicator that it might be time to scale, is asking yourself, do you always have to put your future plans on hold? This one is a hard one for me, because we're creatives, right? I am constantly coming up with new ideas of here's a course I'm going to teach or here's information I want to share, and how do I get it out there? And what do I do? And all of that takes a lot of time and energy. And I know you have the same thing. There are these projects or these things that you want to do: new products, new services, just other areas for growth. And if we're always pushing off the dreaming or the exploration, or maybe even the implementation of those new ideas, just to keep up with current work - again we're being limited. And so creating time to work on those activities is also part of growing the business and we need to think about that. What do we need to put in place to be able to do that?

MICHELE (09:03) The fourth thing that might be an indicator is that maybe you've reached your technology capacity. If we think back to the comment I mentioned earlier about, hey, let's just go do it all and, you know, I can handle this by myself...We use that right? But at some point, we are going to not only exhaust the time that we have, but our understanding of concepts. I'll give you a prime example. I am at the point I mean, I'm like you I'm a smart woman. I can figure most things out. But I have reached the end of my capacity.Not just in time and technology, but even in desire to dig into some things deeper. So I've hired it out. I get help with my social media. I get help with my website. I get help with my automation. I get help with different things and you can too. For you maybe it's getting help with your your drawings right your construction drawings or other things. It's not that I can't do those things, but is that really where my genius shines? Is that really where I want to show my superpower? And to be honest, that's not mine. And so I would rather have other people step in and help me do that. So that I can use my time to serve my clients and reduce stress and do the things that I'm great at doing.

MICHELE (10:24) This fifth indicator I have felt, and my guess is many of you have as well. And it's this..Are you exhausted? Do you find yourself work, work work, and maybe your days at work or getting longer. Work is creeping into all of your family time. I've had clients tell me they climb into bed with their laptop and they lay there and they work until one or two in the morning and then they get up at five or six and do it again and they're running on three hours of sleep. And they are constantly shifting hats and activities all day long. And it is exhausting. Somewhere in the back of your mind, you know, there's got to be a better way. And I remember and I remember thinking, "This can't work." Is there a way I can do this business with ease? And what might that look like? And that is a signal that you need help.

MICHELE (11:14) Now let me say this. There is no glory and feeling like we're working ourselves to death. Spinning these plates in the air and all of us have the joke about, I hope it doesn't break or hope the paper and plastic is what falls - where we hope nothing falls. None of this leads to a sane life into peace, right? Scaling allows us to do more of what we love and the way that we love to do it with those we love to serve. And it just doesn't have to look the same for everybody. You know, there may be some companies that think I don't want to scale. If you are running into all of those five indicators we talked about, yet you say "I do not want to scale" then what you might need to look at is how to increase your prices. increase your service offering and reduce the work. Bring in some technology and some other things. Everybody has their way.

MICHELE (12:09) Let's look now at where do we start analyzing our company for growth to determine what's right and what's best for us. First, I would have you clearly define your business goals and your vision. Where do you see the business going in one year or three years or five years? What does that look like? Because if we're going to scale and grow your business, we want to do it with a plan in mind of where it is you want to go, Not just scaling and hoping that we're making the right choices. If your goal is to keep working the same amount of time but the same types of clients and projects and make more money, then we might have you scale differently from the person who says" I want to work less and make the same or more." Different, totally different versions of business goals. And those are valid. If you come to me and say "I want to build a firm." And I want to have, you know, all these associates under me, that might be a completely different plan, as well. We need to really brainstorm and think about where you want to take your business.

MICHELE (13:14) After you've done that, the next thing I want you to do is identify your pain points. What hurts the most? And seriously, write it down. Try this. Get a piece of paper and write down every single task for the next week or two, right? That you would love to delegate. When it comes in your mind, I want you to ask yourself the question - "Would I be happy if I never had to do this again"? And if the answer is "Yes," write it down on a piece of paper. That's a good place to start. Then what we can do is take those pain points, and we can look at them and we can start to see are they in the same skillset? Can we get a job description out of that? What kind of help do we need? Is there a technology solution for those pain points, but write them down. And my pain points in my moment may be very different from yours. But once we have the activities written down that we either don't like to do, that overwhelm us, that we're happy to give away, we then can see more clearly where we need to start by growing our business...Or supporting the business so that other pieces and parts can grow.

MICHELE (14:21) After that, I want you to look at the timing. You know, I'm gonna stop right here and say this. Can you tell this is very, very similar to the design plan that you would do in a room or for window treatment or anything else? You're going to walk in. You're going to assess what are we keeping what are we getting rid of? How are you going to use the space? What are your pain points?...That's what we're doing for your business. I'm helping you design a scale plan or a growth plan. So the way that I'm walking you through this is the same way that you walk through and so you should naturally be inclined to think this way. But what you want to do now is determine the timing. How long do you have to implement? How long can you keep doing business like you're doing it? Do you have time to be relaxed and solving it? Or, you know, are you up against something that you need to do it and do it now? Maybe you're thinking about this well in advance and you're laying the groundwork. In some ways, I wish I had thought about it even sooner. Perhaps you're up against a hard place. Let's say you're maybe moving out of your home and into a space and is retail and all of a sudden you gotta have some money in front of you. That's a huge change. And that is a big scale plan. Knowing the timing and how quickly you need to make decisions will help you as you move forward with this plan.

MICHELE (15:44) After that, consider people and technology. Honestly, I'm a fan as you can tell a getting processes and technology in place as soon as possible. And then hiring after that. If I have no process, no technology, and I'm overwhelmed, and I have hire a person...Now I have to sustain a certain level of work to cover me and to cover them. But if I go in and make sure that my internal systems are set up, or that my processes are set up (as much as I possibly can) and then hire, number one, I'm prepared for them. I can hire with intention, so I know the skill set that I need. But number two, I can go back and look at those pain points and know that I've got technology in place that whoever I hire can use to support where my company is going. So good systems and processes are vital to success, and hiring the right person will seriously help you. You just don't want to have the right person and no process or a terrible process. Now, let me say this. On the other hand, I have also, in some cases, known that I needed to build processes in certain ways or technology. I didn't know how to do it. So I hired somebody to build it. That goes back to that determine the timing and identify your pain points and the fact that it just wasn't something that I knew how to do as deeply as it was going to take me to figure it out.

MICHELE (17:16) So that leads me to our last point. Set aside the money. Business growth happens because we have intent and we have money to invest. It takes money and time and effort and energy to grow this business that we all have. And so I want you to stop and ask yourself, how much are you willing to invest in the changes in time and money? Bringing on a new technology solution or a new staff person, it takes both. We got to have time to ramp up. A plan to pay...And when hiring a person, I really if you've not heard before we get this question all the time..."When can I hire?" I would say you need to know exactly what you're hiring for. You need a good job description. You need an onboard plan, and you really want we're talking about the money need to save three to six months of their salary before you hire them. Because once they come on, in most cases within the first three months, they're not wildly profitable for your company. They are learning and they're growing and they're onboarding. And so you need to have that cushion that allows you the flexibility and the ability to stop what you're doing and help them - knowing that your income will probably take a slight hit while you're bringing them up to speed. And I think this is crucial. If you can't save the money now, for the person that you want to hire, you're really not ready to hire them. Okay? Because if we don't have the money, how do we think we're going to keep them employed, and nobody wants to bring somebody on that they've got to turn around and let them go.

MICHELE (18:46) Every business planning, to grow, needs help. And by knowing your goals for the business, and then identifying what's stopping you, putting systems in place, identifying technology, your people that you need, and then setting yourself up for success is exactly what you need to do. Just don't forget timing and money, it can be extremely disruptive to a business to make all these changes at once too. So don't feel like you have to do that do a more planned or a more gentle approach, if you will, to doing some of these things. My growth has taken years, I didn't go in and scale quickly, I scaled a little at a time with what I knew that I could afford and time and money. And so you can be intentional about that it doesn't have to be in everything or nothing.

MICHELE (19:45) Thank you for listening, today. The goal of the Designers' Inner Circle is to empower, equip, and to encourage those who are working with. Each month we look at scenarios and discuss the real business problems in front of each entrepreneur and then help them make a plan...Just like this for scaling that fits them. Join us and let us help you do the same. You can find out more at ScarletThreadConsulting.com. Remember, profit is a choice and it doesn't happen by accident.