March 18, 2019
6 Questions to Ask Before Pursuing Business Expansion
Whether it's expanding a current location’s size, opening an entirely new establishment, or acquiring another business, having additional space to grow your business can be beneficial. In this post, we’ll provide six questions regarding business expansion projects that you should be able to answer. By reflecting on these questions, you can determine if this is the right time for your business to move forward with a business expansion strategy.
Is it Time to Expand Your Business? Answer These Questions:
1. What am I going to achieve by expanding?
Before expanding your business, you should consider how it'll potentially grow your business. Below, you'll find a few ways that expanding can improve your existing operations.- Meet Existing Customer Demands: By expanding to a new location or expanding on an existing one, you can better serve your current customers. You should always consider your existing market and how you can give them the best possible service!
- Roll Out new Products or Services: Another way to expand your business is to offer additional product lines or new services. Perhaps your customers have requested these options, or you're trying to expand your target market.
- Increase Brand Recognition: By growing your business, this can increase people's awareness of your brand. This is especially the case if you invest in marketing this project on social media and other avenues.
2. Do I have enough financing to expand my business?
Prior to starting a business expansion project, you should consider what you’ll do if things don’t go as planned. What if construction costs end up being more than you expected, or you’re forced to invest in certain areas of the project that you didn't think you'd need to? If you run out of financing, the project could go un-finished, which could be extremely detrimental to your business growth. Don’t risk financial failure by incorporating a budget into your business expansion strategy. You should account for all costs that you know of, but also leave room for additional expenses. If you’re uncertain if your business’s bank account can finance an expansion in addition to your existing operations, it may be wiser to save up and execute this project in the future. Another option is to apply for an expansion loan.3. Will I be able to afford hiring new staff members?
Expanding your business’s operations might mean hiring extra employees to manage your new space. This could potentially be an expensive and time-consuming initiative, as you’ll need to have funding to pay these employees, as well as time and resources to train them and ensure they are ready to work at your business. Of course, expanding your business can be stressful, so chances are you won’t have a lot of time on your hands. Get help from an experienced, tenured employee who can assist in the interviewing, hiring and training processes.