Expanding your business is as crucial as launching it. Just because the business is already in existence, it doesn’t mean that it will not require the same careful research and preparation it took you and your team to build it from scratch.
Perhaps, your supply space is no longer enough, to the point that you have to build an extra mezzanine floor in your warehouse; or the company records are showing you the consistent wave of demand for your products. These signs are pointing towards expanding your business in terms of location, marketing, and employment. The excitement brought by your success may trigger a hasty decision on your part.
To be extra certain, here is a checklist before you give the expansion a go signal:
Are you ready for the extra responsibilities?
Increasing the number of your team members does not translate to having fewer responsibilities. Building a bigger team means strategically finding individuals whose long-term goals are complementary to the company’s vision. Every new location is a multiplication of your initial duties and worries. The fulfillment, however, will make all the hardships worthwhile.
Is there a consistent cash flow?
This is a no-brainer. You’ll be needing a lot of money for the expansion, money that will not be returning to your business for a while. This also includes the extra budget for probable unforeseen costs. Focus on your business’ net income, and assess the pattern if the rise of your profit is merely temporary or not.
Does your business have a solid system?
Preparing your team for the transition is crucial. The success of the expansion also lies in the capability of your old and new employees in addressing the needs of a bigger business, bigger market, and bigger office. In addition to that, study the most foolproof marketing and sales plan.
Are the customers voicing out their demands?
Your business should have loyal and still-growing customers who seek you out constantly. Having customers who consider your business as part of their habit are the source of steady income. When they demand you to expand- literally tell you to do so- you can’t help but listen to the suggestion because they might be right.
Is your industry booming?
You must know if your market is becoming saturated or if it still has untapped potential for customers. You may not want to expand if the industry is fading. Losing money poses a high possibility. If ever the industry where you’re in is stagnant, you can offer new products that will provide a stable form of income for your business. However, it’s risky.
Can your space no longer contain the work?
Your business has maximized its current space, and it needs more. It’s important to have a productive-centered area where your employees can manage and accommodate the larger demand for your products.
Expanding will feel like you’re starting a business all over again, considering the time, money, and effort it requires. Study the market trends first if your business is really calling for expansion. And more importantly, know if you and your company are ready for it financially and structurally.