How to Scale an Agency in 10 Simple Steps

Starting an agency business is easy, running and scaling isn’t. You need to figure out client acquisition, hire team members, and position yourself as an expert. And doing everything yourself isn’t a walk in the mark, you might need to outsource some of your tasks.

As an agency owner, that’s a lot to take in. Luckily, I wrote this guide for people like you. If you’re not sure how to scale an agency in 2024, read on.

What is agency scaling?

To scale an agency means to grow or expand the business in a cost-effective way. This could include taking on more clients, hiring more employees, expanding services, or increasing revenue while minimizing costs. Scaling an agency isn't just about expansion, it's also about improving efficiency and profitability as the agency grows.

How do you scale up an agency?

Before you take a deep dive into the topic of scalability, there is one thing to keep in mind: every business is scalable, but only if you have a plan. Follow the 10 steps outlined below to make sure that you can streamline your operations and grow your agency in the next months.

Define goals

If you want to scale your marketing agency, the first question to ask is: what does success look like for you? Each of these goals should be specific, measurable, achievable, relevant, and time-bound (SMART) to effectively scale up the agency.

Here are 8 goals you can define to get you started:

1. Revenue: Improving revenue is a core business goal you should aim for. Target a specific quarterly or annual revenue goal. It can be related to recurring revenue or new client acquisition.

2. Retention: Keeping client turnover low is crucial for the growth of the agency. Set a percentage-based goal when it comes to client retention, and keep an eye on it through-out the year.

3. Team expansion: As the agency scales up, more human resources will be needed. By predicting your annual revenue, it’s easier to build an agency team and hire at the perfect time.

4. Operational efficiency: Use automations or simplify your services by productizing them. Also, give your team the tools they need to be productive, delegate efficiently, and continuously train your team to be efficient.

5. Profit margin: Define the gross or net profit margin your agency aims to achieve. Ideally, these should be in place when you start your own agency, but you can adjust them as you scale up.

6. Market expansion: Think about expanding into new verticals to increase business opportunities. For instance, a content agency could partner up with a link building agency and offer their services to their clients.

7. Brand awareness: Aim to increase the brand’s visibility and credibility in the market. You can either use the founder’s personality, build a community, or find partner agencies with common goals.

8. Leadership development: Becoming a better leader can be the final step in scaling your digital agency. Founders can take courses to improve their leadership skills, find a mentor, or join groups with like-minded people.

Evaluate operations

When you’re starting a new business, you’ll spend most of your time trying to get the hang of running your agency; optimizing your operations will be a task for a later. Once your agency is up and running, start focusing on optimizations, and ask yourself:

• Which are my most sold services?

• Which services are not worth keeping?

• How can I improve the project delivery?

• Am I hiring talent at the right time?

• Can I handle everything in-house?

• Are clients happy with the quality of work?

• Should I focus more on my marketing efforts?

• Are there any agency tools that could improve my flow?

By answering these questions, you’ll be able to re-evaluate your business models, use marketing channels that are worth the investment, add new team members at the perfect time, and use the tools you need to be successful.

Identify needs

Once you have a clear idea of your current operations, start writing down your wants and needs. After all, you should have a goal with your agency, and not just keep it running on autopilot.

Here are a few agency needs to inspire you:

• grow annual recurring revenue by 15% in 12 months

• partner up with 3 agencies in 8 months

• get 5 big clients to boost monthly revenue by 25% in 18 months

• grow agency team with 5 new colleagues within 2 years

• remove 2 services that account for less than 5% of total revenue

When it comes to optimizing processes, having clear needs and goals in mind will make it easier to figure out where you can make impactful changes to your operations. Scaling requires you to be very good at identifying these opportunities, though, which is the biggest challenge agency owners will have to face.

Productize services

The productisation of services can be the next step in your agency growth journey. Instead of providing custom services to each client, package them into a pre-defined set they can choose from. You’ll benefit from less time spent on individual projects (and calculating prices), leaner project management, improved team workflows, and higher profit margins.

When it comes to the productization of your services, check the most popular services you’re already successful with, build packages that you can sell easily, and set up automations to make the delivery and fulfillment easier for your team. As an example, if you’re an SEO agency that offers a one-time audit, make an API request via SE Ranking to run the audit once your clients has placed an order and filled out their SEO intake form.

Implement systems

Modern software makes it easier to sell and fulfill your service offerings in a time efficient, high-quality way. Funnel all your data into a client portal where your team and clients can log into. These tools are perfect for agencies because they can manage most of their operations: starting with their lead generation efforts all the way to invoicing and project delivery.

Another big benefit of modern client portal tools is their ability to send and receive data from other tools. With SPP, you can use Zapier to automate your operations, make use of webhooks, or build your own automations with our API.

Hire talent

As your agency grows, you will need more hands on deck. The key to scaling is to hire at the right time. Only then can you expand your business without compromising on quality, or refusing new clients because you don’t have the resources to fulfill projects.

Ensure that you’re hiring the right people in order to grow your agency, meaning the individuals are talented and motivated. Maximize your investment by giving them the tools they need to be efficient, but also train them to acquire new knowledge.

Boost brand

Nothing seals the deal easier than a brand that is well-known. Boost your brand’s credibility by making use of white label client portal software. Your clients will not know that you’re using third-party software to run your operations.

You can also increase your brand visibility through content marketing, outreach, referral marketing, search engine optimization, and social media marketing. If you have the resources for it, create a podcast, or organize online events such as webinars. Lastly, hire a PR agency to spread the word about your company.

Retain clients

Nothing costs more than losing clients. The sad truth is that a lot of agencies focus on attracting new clients instead of ensuring that the loyal ones stay. Those are the ones you should focus on, though. They provide the stable revenue that can support your growth for years to come.

Fostering client relationships long-term is an art, one that every agency owner should master. Achieving growth without a stable set of clients is almost impossible, as you’ll spend money and time constantly looking for new customers. That is why I recommend that you start automating your onboarding process, assign account managers or customer success people who constantly track metrics, and follow-up with clients.

Form partnerships

Once you’ve set up processes to keep your existing clients close, it’s time to branch out and find agencies with similar interests. The goal is to form partnerships with companies that compliment your services.

For example, if you’re a link building agency, you could collaborate with a content agency. Your clients might be interested in getting content written for their landing pages or blogs.

Partnerships should become an essential part of your business development process, especially if you’re looking to offer new services. Instead of hiring talent for that specific service, you can resell them through a trusted partner, for instance with SPP’s reseller module. There’s less risk involved and you can test the market before investing time, money and talent into it.

Monitor metrics

If you’ve reached this point, you’ve ticked most of the boxes of your roadmap. There’s one final step though, and that is to track metrics about your agency. Anything from your recurring revenue to the services your clients buy—make sure that you have systems in place that can give you relevant data about your business operations.

Get an overview of all your metrics with our powerful reporting.

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Learn more

If you’re using Service Provider Pro, all this information is available on your client portal dashboard. You can see the most sold services, revenue by clients, assigned orders, completed tasks, and much more. This information allows you to focus on parts of your business that require optimization. For instance, if you see that you’re missing task deadlines, try to figure out why your team is struggling with fulfillment. Either you need to hire more talent, or optimize your processes.

Scaling an agency FAQ

Start scaling your agency now

If you’re looking to take your agency to the next level, the 10 steps outline in this post will guide you through the entire process of growing an agency. I’ve seen from experience how many founders are struggling trying to scale their operations, and it’s often due to not tracking business metrics, not using the right tools, and lacking recurring revenue.