As a successful business owner, you will reach a time when you start to think of expanding your business. This may mean taking on staff, moving premises, finding new customers, maybe finding new suppliers and a need for more capital. What are the signs that you are ready to grow your business?
How will expansion change your business?
Taking the next step is a big decision and not one to be taken hastily. As a business grows and you look to go beyond what you can do yourself, your whole business structure changes.
- Financially you will have greater responsibility. You will have staff that you need to pay each month, a fixed rent to pay, higher outgoings and more customers to chase for payment. In other words, Cashflow becomes even more important. Even more so if you are looking for external funding to finance the expansion.
- Your business will get larger, this means more customers to keep happy, more suppliers to deal with and staff to control. How will you control, or delegate responsibility?
- Legal requirements increase, the obvious one being the treatment of any staff, both financially and ethically.
6 Signs that your business is ready to expand
1. Your business type.
If your business is in an area that is growing rapidly then that is good indicator that the market for growth is out there already. This could be a good time to grow and get ahead of the competition.
2. Your customers
Before even thinking about an expansion, you must have a good base of regular customers already in place. For starters this will show there is a demand for your product or service. They will help you with recommendations to others as well as maintaining your finances.
Regular customers are your best customers, you must have them in place and be able to keep them happy.
If your customer numbers increase rapidly don’t immediately consider expansion. Give yourself time to make sure these new customers keep coming back.
3. Being asked to grow.
Quite often you, as the business owner, will have a sense of when it is time to grow. But, If your customers start asking you to expand then it may be worth listening to them.
This is a sign that they are expecting their demands to increase and they want to make sure you will be able to continue to meet them.
It is often forgotten that it is easier to grow a business, sales and profits, by providing more to your existing customers, than by finding new ones. Not that you should stop looking for new customers as well!
4. Consistent Profits
If your profits are consistent, or even better increasing, this shows you have a sustainable business in the first place. Plus, this could be a sign to expand your company.
Regular profits can be used to invest in an expansion, reducing the need for external finance.
5. Too much business
If you cannot meet the supply and demand of your business then expansion may be the right thing for you. Going back to point 2, this business demand must be a regular issue, not just a one-off.
If regular requests are too much for your business to handle then expansion should be considered. Your business is clearly popular and expansion will help you bring in more customers.
6. Your goals
Some business owners are more than happy to remain small, one-man or one-woman bands with a nice steady, safe income. There is nothing wrong with that at all.
But for others, there is a vision of building a bigger business, and only you know whether you fit into this category. For all the business reasons given in points 1-5, ultimately it comes down to your personal goals. Ask yourself a few quick questions:
- Do I have the time and energy to grow the business?
- Have I got the ambition to see this through?
- Can I accept losing some control over my own business?
- Have I got the resources and support this will need?
What to do next
As with any big business decision, planning is the key. Do not rush into it. Take some advice, make a plan (and a plan B), and make sure this is the right decision for you.
I have assisted many business owners with their growth plans, and will help you avoid the pitfalls, and take advantage of the opportunities to help your business growth be successful.
If you need some advice, why not take advantage of my complimentary discovery call, and we can discuss your plans for your business.
Chase the vision, not the money. The money will end up following you.
