Every entrepreneur faces challenges, but thriving in tough economic conditions requires strategy, adaptability, and resilience. This was the central theme of the latest episode of the Access Bank SME Digest Show on Classic FM 97.3, where host Chico welcomed Mr. Ayodeji Peter Falope, a seasoned business strategist and entrepreneur, to discuss how small and medium enterprises (SMEs) can scale and succeed despite economic challenges.
If you missed this episode, you can listen below
Why Scaling Matters, Even in Tough Times
Many SMEs are in survival mode, focusing solely on keeping their businesses afloat. However, Ayodeji emphasized that scaling is not just about expanding operations—it’s about growing revenue strategically and efficiently.
He broke down the difference between expansion and scaling:
- Expansion means increasing product lines, entering new markets, or hiring more employees.
- Scaling means generating more revenue with minimal additional costs, leveraging efficiency, technology, and smart resource allocation.
In a volatile economy like Nigeria’s, inflation and external factors constantly increase operational costs. If businesses don’t scale faster than inflation, they risk stagnation or closure. Scaling strategically ensures continuous revenue generation, positioning a business to thrive rather than just survive.
Mindset Shift: From Survival to Growth
Many business owners see scaling during difficult times as risky, but Ayodeji stressed that businesses don’t have a choice—they must scale or risk shutting down.
“If you don’t breathe, you don’t survive. The same applies to business—if you don’t scale, your business won’t survive.”
To shift from survival mode to growth mindset, businesses must:
Recognize that every naira earned is a naira someone else didn’t get—competition is inevitable. Understand that efficiency leads to profitability—scaling isn’t just about revenue, but also about reducing costs. Embrace technology—AI and automation can significantly improve efficiency and reduce expenses.
How Technology Drives Efficient Scaling
Technology is not just about computers and phones—it includes automation, AI, and process optimization. Businesses should:
- Leverage digital tools to streamline operations, reduce manual work, and improve efficiency.
- Adopt AI-powered automation to cut down staffing costs while increasing productivity.
- Use cost-effective software for accounting, customer relationship management, and marketing.
Example: A company reduced its staff from 13 to 5 after training employees in digital skills, doubling efficiency while cutting costs. The result? Higher profits with fewer resources.
“AI won’t take jobs, but those who use AI will replace those who don’t.”
Scaling Smartly: Internal & External Strategies
Scaling isn’t just about internal business improvements—it also involves external resources and financial support.
1. Cutting Costs to Improve Profit Margins
Reduce operational expenses by optimizing processes and automating repetitive tasks. Increase revenue streams by identifying new markets and products. Balance both strategies to maximize profitability.
2. Accessing the Right Financial Support
Contrary to popular belief, the biggest challenge for SMEs is not lack of funding, but lack of financial readiness.
“Banks and investors are actively looking for businesses to finance, but they only fund businesses that meet specific criteria.”
To attract funding, SMEs must: Maintain proper financial records—structured accounting makes businesses more attractive to lenders. Demonstrate financial responsibility—timely loan repayments improve creditworthiness. Showcase business potential—investors seek businesses with clear growth plans and scalable models.
3. Smart Borrowing Strategies
When considering a business loan, SMEs should: Ensure the loan is used for business, not personal expenses. Structure repayment plans based on cash flow to avoid financial strain. Work with reputable financial institutions to avoid predatory lending.
Final Thoughts: Scale or Die
Scaling isn’t a luxury—it’s a necessity. Businesses that fail to scale risk closure.
Key Takeaways:
Scaling is about smart revenue growth, not just expansion. Technology and efficiency drive profitability. A growth mindset is essential—businesses must embrace scaling or risk being left behind. Financial readiness is key—funding exists, but only for businesses that are prepared.
For more expert insights, tune in to the Access Bank SME Digest Show every Tuesday at 7 PM on Classic FM 97.3.
What’s your biggest challenge in scaling your business? Share in the comments below! 