3 Mistakes That Keep Your Business Stuck Pt. 1

Reasons Your Business Can’t Scale

In this video, we’re going to explore the three main reasons your business can’t scale. And when I say scale, I’m not talking about incremental growth; I’m talking about exponential growth, where your business multiplies in nature. Everything should grow by multiplication, not just addition. Let’s delve into why your business might be struggling to achieve this level of growth.

1. Wrong Business Model

The first main reason your business can’t scale is because you have the wrong business model. What does that mean? There are different kinds of business models, and the wrong one is what I call the “entrepreneur business model.”

The entrepreneur business model can be represented as LP (Low Profit) times LV (Low Volume), which equals Entrepreneur (LP x LV). In this model, entrepreneurs make small profits and have low sales volume. They might make a sale and earn a minimal amount, like $5, $10, or $15, and they only make a few sales per month. This approach stifles growth and keeps them from scaling.

Many people in various fields, such as multi-level marketing, affiliate marketing, and coaching, often find themselves trapped in the entrepreneur business model. They might have small coaching programs and charge a modest fee per hour, with only a handful of clients per month. This limited profit and low volume hinder their progress.

To fix the entrepreneur business model, you need to address either the profit or the volume, or both. The main issue is that they’re stuck in a cycle of low returns, and they need to break free from it.

2. Misguided Business Plans

Often, individuals get lured into the wrong business model by misguided business plans and marketing programs. They are promised that by joining a particular business opportunity and selling products or services, they will achieve financial success. For example, multi-level marketing can be lucrative for some, but for many, it results in limited profits and sales volume.

3. Lack of Understanding of Distribution

Many entrepreneurs fail to understand the importance of distribution points. To scale a business, you need to create multiple distribution channels or points. Without a robust distribution strategy, your business won’t reach its full potential for growth.

In summary, if your business can’t scale, it may be due to the wrong business model, misguided business plans, or a lack of understanding of distribution. To achieve exponential growth, you need to reevaluate your approach and make the necessary changes to break free from the limitations of the entrepreneur business model.

The Entrepreneur Business Model

Let’s dive deeper into the entrepreneur business model and why it can hinder your business from scaling. The entrepreneur business model is characterized by having high profits but low volume. Here’s why it might be holding you back:

Recruiting is Key

Unless you’re actively recruiting new Distributors in a multi-level marketing business who actually move volume, you are not an entrepreneur; you are an entrepreneur. To scale your business, you need to focus on building a team that generates sales volume.

Example with E-commerce

Suppose you have an e-commerce business where you sell products on platforms like Shopify, eBay, or Amazon. If you’re making only 10 sales a month, each bringing in $15, that’s a total of $150 a month. In this scenario, you are an entrepreneur, not an entrepreneur. This model limits your growth potential.

The Better Business Model

To scale more effectively, consider adopting a different business model, which I call “Business Model B.” However, it’s essential to make the right moves to scale successfully within this model.

Entrepreneur Business Model

The entrepreneur business model is characterized by having high profit but low volume. For instance, imagine making $30,000 a month by selling high-ticket packages, such as $500 or $1,000 programs. This may seem like a significant achievement, but it’s important to note that $30,000 a month was the most you’ve ever made in a year.

Learning from Robert Allen

Around 2004 or 2005, you attended a Robert Allen wealth retreat. Robert Allen is known for books like “No Money Down,” “Multiple Streams of Income,” “Multiple Streams of Internet Income,” and being the co-author of “The One Minute Millionaire.” At the retreat, he asked for a testimony from someone who had used his information to make money.

One of the programs you had from him was called “Infopreneuring,” which included six CDs. You listened to these CDs daily for years, aiming to integrate the knowledge into your DNA. This dedication and immersion in his teachings reflected your determination to achieve financial success.

Transformation from Trash Man

You shared your journey from being a trash man earning 6.25 cents an hour to exploring various business models and striving for financial growth. It highlights your determination to break free from limitations and find a more successful path to scaling your business.

In conclusion, the entrepreneur business model, characterized by high profit and low volume, can be a hurdle to scaling your business. To achieve exponential growth, you need to consider alternative models and strategies to increase both profit and volume. Your journey, including learning from experts like Robert Allen, has been instrumental in your quest for success.

The Waltripreneur Business Model

Now, let’s explore the “Waltripreneur” business model, which is characterized by low profit but high volume. This model takes inspiration from Sam Walton’s approach to business. Here’s how it works:

Sam Walton’s Approach

Sam Walton, the founder of Walmart, had a motto: “I don’t ever want to make more than a 30 percent markup on the stuff I sell.” He believed in offering low prices to customers, often passing on good deals from vendors.

Low Profit, High Volume

In the Waltripreneur business model, the focus is on achieving high sales volume while keeping profit margins relatively low. Instead of aiming for significant profits on individual sales, the goal is to sell a large quantity of products or services.

Scaling the Waltripreneur Model

To scale this business model effectively, you need to embrace strategies that revolve around high-volume sales. Here are some key approaches:

1. Cost Efficiency

Maintaining low operating costs and optimizing efficiency in your business operations is crucial. This enables you to offer competitive prices to customers while still making a profit.

2. Supply Chain Management

Efficient supply chain management is essential to ensure you can source products at competitive prices and maintain an adequate inventory to meet high demand.

3. Marketing and Promotion

Implement marketing and promotional strategies that attract a large customer base. These may include advertising, discounts, and special offers to drive sales volume.

4. Customer Experience

Focus on providing excellent customer service and a positive shopping experience to encourage repeat business and word-of-mouth referrals.

5. Inventory Management

Carefully manage your inventory to ensure you have the right products available at the right time to meet customer demand.

6. Technology and Automation

Leverage technology and automation tools to streamline processes, manage inventory, and enhance customer interactions.

By following these strategies, you can scale your business within the Waltripreneur model. The key is to prioritize high sales volume over high profit margins, making your business model conducive to exponential growth.

The Wealth Entrepreneur Business Model

Now, let’s delve into the “Wealth Entrepreneur” business model, which combines high profit with high volume. This model allows for significant financial growth and can be a rewarding path for those who align with it. Here’s a closer look at this model:

High Profit, High Volume

In the Wealth Entrepreneur business model, the aim is to achieve both high profits and high sales volume simultaneously. Unlike the Waltripreneur model, where the focus is on low profit margins and high volume, the Wealth Entrepreneur seeks to maintain substantial profit margins while selling a large quantity of products or services.

Self-Publishing as an Example

For example, self-publishing books can be a lucrative endeavor within this model. Self-publishing allows for higher profit margins compared to traditional publishing. You retain more control over your earnings by bypassing the hefty cuts that traditional publishers, bookstores, and distributors often take.

Finding the Right Business Model

The key to success in the Wealth Entrepreneur model is to find a business model that aligns with your personality, strengths, and preferences. Not every business model is suitable for everyone. It’s crucial to choose a model that matches your DNA and allows you to thrive.

Aligning with Your Strengths

For instance, if you’re passionate about creating and selling books, self-publishing might be the right choice. It aligns with your strengths and enables you to maintain high profit margins. On the other hand, if you dislike certain tasks or activities within a business model, it may not be the best fit for you.

Building Wealth

The Wealth Entrepreneur model is about building wealth and creating a business that serves you at the highest level. It’s not just about following the money blindly but about making strategic choices that resonate with your values, goals, and strengths.

In conclusion, the Wealth Entrepreneur business model is characterized by high profits and high volume. It offers the potential for substantial financial success while allowing you to stay true to your strengths and preferences. Ultimately, choosing the right business model that aligns with who you are is essential for achieving long-term success and satisfaction.

Scaling the Wealth Entrepreneur Business Model

Let’s continue to explore the Wealth Entrepreneur business model, which focuses on high-profit, high-volume products and services. This model can offer significant opportunities for growth and financial success. Here are key insights on scaling within this model:

Leveraging High-Profit Products

In the Wealth Entrepreneur model, it’s essential to leverage products or services with high-profit margins. For example, self-published books can offer substantial profits due to low production costs compared to their selling price.

The Power of Consulting

Consulting is another example within this model. When you excel at a particular skill or expertise, you can charge high fees for your consulting services. This is possible because clients value your expertise and are willing to invest in it.

Example of High-Profit, Low-Volume Products

Consider the example of a book priced at $30, with a production cost of approximately $2.50. This results in a profit margin of over a thousand percent. If you sell 700 copies in a month through your website, it can bring in an additional $28,000 in revenue, demonstrating the power of high-profit, low-volume products.

Scaling Strategies

To scale effectively within the Wealth Entrepreneur model, consider the following strategies:

1. Focus on Expertise

Identify your areas of expertise and strengths. These are the areas where you can offer high-value products or services and charge premium prices.

2. Build an Online Presence

Establish a strong online presence, including a professional website and social media presence. This allows you to reach a broader audience and showcase your expertise.

3. Marketing and Promotion

Implement effective marketing and promotional strategies to attract clients and customers who value your offerings. Highlight the unique benefits of your products or services.

4. Automation and Efficiency

Leverage technology and automation to streamline your business processes. This can help you manage client inquiries, appointments, and other tasks more efficiently.

5. Diversify Your Offerings

Consider diversifying your product or service offerings within your expertise. This can provide multiple revenue streams and opportunities for growth.

Matching Your Business Model to Your Strengths

Ultimately, the Wealth Entrepreneur model is about matching your business model to your strengths and passions. It’s about offering high-value products or services and charging accordingly. By doing so, you can build a business that serves you at the highest level and has the potential for substantial scalability.

In summary, the Wealth Entrepreneur business model focuses on high-profit, high-volume offerings. By identifying your areas of expertise and leveraging them effectively, you can create a business that aligns with your strengths and goals while achieving significant financial success.

The Importance of Offering What the Market Wants

The second reason why your business might struggle to scale is because nobody wants your product or service. This might sound harsh, but it’s essential to address this issue to achieve success. Here’s why people might not want what you’re offering:

Start Where the Market Wants

Many entrepreneurs make the mistake of starting a business based on their personal preferences or ideas without considering what the market actually wants. Just because you believe in your product or service doesn’t mean others will.

Solve Real Problems

Successful businesses are built on the foundation of solving real problems for their customers. People are willing to pay for solutions to their problems, not for something they don’t need.

The Market Decides

It’s not about what you want to sell; it’s about what the market wants to buy. The market decides what is valuable by showing interest and making purchases.

Understanding Customer Needs

To offer products or services that people want, you must understand your target audience’s needs, pain points, and desires. Conduct market research, gather feedback, and adjust your offerings accordingly.

Fixing the Right Problems

Your product or service must genuinely fix a problem or provide value to your customers. If it doesn’t address their needs or pain points, they won’t be interested.

Communication Is Key

Effectively communicate how your product or service addresses specific problems or fulfills desires. Focus on the benefits and outcomes your customers will experience by using your offering.

Avoid Assumptions

Don’t assume that just because you think your solution is excellent, everyone will want it. Let the market validate your offering through their actions and willingness to pay.

Be Willing to Adapt

If you discover that your product or service isn’t resonating with the market, be willing to adapt and make necessary changes to better align with customer needs.

In summary, the key to overcoming the second challenge to business scalability is to offer products or services that the market genuinely wants and values. Focus on solving real problems and addressing customer needs rather than pushing something you’re passionate about but that doesn’t resonate with your target audience. By understanding and serving the market effectively, you can build a successful and scalable business.

Selling Solutions, Not Products

The second major reason why businesses often struggle to scale is because they offer products or services that nobody wants. It’s crucial to understand why this happens and how to address it:

Address Real Problems

To create a successful business, you must offer products or services that address real problems or provide value to your customers. People are more likely to pay for solutions that genuinely solve their problems or fulfill their needs.

Understand Your Audience

To identify what your customers truly want, it’s essential to understand your target audience’s needs, preferences, and pain points. Conduct market research, gather feedback, and tailor your offerings accordingly.

Avoid Assumptions

Don’t assume that just because you think your product or service is great, everyone will want it. Let the market validate your offering through their actions and willingness to pay.

Effective Communication

When promoting your product or service, focus on communicating how it solves specific problems or fulfills desires. Highlight the benefits and outcomes that your customers will experience by using your offering.

Adaptability

Be willing to adapt and make necessary changes to your product or service based on market feedback and customer preferences. Your business should evolve to meet the evolving needs of your target audience.

Avoid Wasting Resources

Don’t waste your time and resources on promoting products or services that people don’t want. Instead, focus on offering solutions that align with customer demands and preferences.

In summary, the key to overcoming the challenge of selling products or services that nobody wants is to focus on solving real problems and providing genuine value to your customers. Understand your target audience, avoid making assumptions, and be open to adapting your offerings to meet their needs effectively. By doing so, you’ll be more likely to create a successful and scalable business.

Lack of Understanding

That’s real talk. The other reason is they don’t understand your product or service. Why don’t they understand it? They don’t understand because you have done a poor job of explaining to them why your solution is the ultimate solution to their problem. They know they have a problem, and it’s not their responsibility to decipher what you say in your cryptic sales message. It’s your job to make them see clearly that the best solution and the best hope they have of making their experience of life better is by saying yes to the offer you’re making them. Sometimes they don’t understand it just because you’re not good at explaining it.

Lack of Capacity

Three, they don’t have the capacity to fix the problem. In other words, they don’t have what it takes. That means even if they bought it, they don’t have the ability to implement the thing that they bought. Capacity could mean they don’t have the money, they don’t have the intelligence to use the thing you sold them to fix their problem, or they’re not coachable enough, or they’re not willing to make themselves available enough. But those are some of the reasons your business won’t scale.

Selling to the Wrong People

The third reason your business won’t scale is that you’re selling to the wrong people. You’re selling to people who don’t want to fix the problem, and you’re selling to people who don’t have the money to fix the problem. Here’s one of the biggest problems, especially for minorities. We want to fix the problems in our community that we used to have, but the people who were trying to fix them for us don’t want them fixed, or at least they don’t want them fixed the most. Stop trying to save people. Jesus is the only savior. If you try to save people from their situation against their will, you’re going to frustrate yourself and irritate them.

Conclusion

So, they don’t want to fix the problem, they don’t have the money to fix the problem, and because of these things, either you have the wrong business model, no one wants your product or service, or you’re selling to the wrong people. Your business can’t scale. In the next part, I’ll discuss the other four reasons your business can’t scale, but once you get these fixed, you’re off to a good start. I hope this video helps you. If it did, feel free to share it with somebody, like it, comment, whatever. Even if you disagree, I like those comments too, as long as you’re not calling people names and being unkind. Hey, I like it when people disagree with me. Sometimes you’re right, and I’m wrong. In the meantime, in between time, peace out.