There comes a time in the lifespan of all businesses that important decisions need to be made. For some, it is whether or not the business is viable. For others, it is whether or not you are ready to take the next step and expand what you do.
Expanding a business is about more than wanting to make changes. You need to be confident that any changes you make are for the right reasons, and you aren’t trying to run before you can walk.
With over 30 million businesses in the US alone and over 90% of those being small to medium-sized businesses, expanding means you can raise your game and help your company be the one that stands out against the competition.
What are the indicators that your business is ready to expand?
You have more work than you can handle.
A given, you might say. But a quite obvious marker is that you are consistently handling more work than you can cope with. Not just sporadically but every day. If you are struggling to cope, then it could be worth considering adding to your team to help you complete your work without compromising on standards and your existing commitments.
Make sure you are utilising any analytics you have. This will allow you to track sales and enquiries and give you insights into trends and patterns that can alert you on the best way to approach the increase in business you are experiencing.
You Have the Right Core Team
A good boss knows the value of good staff and can utilise them in the right way to create a stable core team that can assist you in getting what needs to be done.
The difference between a good boss who knows the strengths of their team and one who pushes for more regardless of how much they do. Knowing how to hire the right team who can work well together and compliment each other and the company is a skill of a good leader and supporting them to assist your business. Hence, they are committed to the company as it will serve you well as you work through any expansion plans you may have.
If you feel like it isn’t a representation of your team, and there are holes in your support network inside the company, expanding will only serve to widen these gaps. Take a long hard look at who you have working for you, how they approach their job and ask yourself how you think they will cope when you increase their workload or add newer employees onboard as you grow.
Do You Need More Space?
An indication that your company, premises or staff needs support from the expansion of services, offices, warehouses and additional team members is that you are starting to outgrow where you currently are. Whether you need more space physically or metaphorically, you need to increase where you work and how.
If you decide to expand your company’s real estate, make sure to take it slowly. Don’t get too excited and end up putting your company in jeopardy. Anticipate your company’s future needs and do your best to find a space that is just the right size — neither too big nor too small. If it’s too big, you’ll waste money on unused space. If you are too small, you may have to expand sooner than you would like.
Data Indicates An Option to Diversify
How are you using software and analytics to help you evaluate your current situation? Successful business owners can constantly evaluate leads, funnels, interest, and gaps in the market you could fill. CRM software can help you improve your customer services, click4assistance can assist with AI chatbot software to help you with data analysis and general inquiries. Clicks to the website, social media interest, sales and shopping habits via tracking, cookies, online behaviour and more are all options to help you assess your capacity for expansion.
Data analytics play an important part in pinpointing your next move and the best options when the time does come to expand on what you do. Data analytics software options include;
Are You Hitting Goals?
When you first started, what were your goals? Can you remember what you had initially set out to achieve? If not, it pays to look back on your original goals and evaluate how far you have come since that first initial thought. That desire to get started on your own in business will have a goal.
Find those goals and ask yourself if you are reaching them and how often are you reaching them. If you aren’t hitting your existing goals, you are in no position to add to your goals until you are ready to reach new heights.
You have Good Cash Flow.
Examine your company’s net income. Subtract your company’s expenses from its gross income. This will tell you how much money your company makes after you pay your bills. If your profits are consistently increasing, it may be time to expand your business.
Don’t only think about short-term success. Your success and earnings may not last indefinitely. Look for long-term success and profits that are consistently growing.
If your business generates consistent revenue, you can reinvest some of your profits. Hopefully, as your business grows, so will your net income.
Having enough cash and doing well on paper are two different things. While you may be doing well, if you have cash flow issues, it could be an idea to put your plans on hold until you have the money to carry them out without taking on debt or sacrificing other areas to fund this venture.
However, if you have enough cash to expand and push into your new plans comfortably, you are well placed and in a great position.
There is a Market
Are you confident that there is a market for what you are proposing to offer? Because while you may be in a good position financially and your business is well placed to increase its output, if there is no one to buy what you are planning to sell or take up a service you want to provide, it will all be for nothing.
Make a list of what your customers want, and then look for patterns. Use your data, pore through the analytics, check out what your competitors are doing and how well they are doing it. Just because you are ready and see value and merit doesn’t mean there is a demand. If you are using CRM software, input any requests to keep track of what people are asking for.
If customers are requesting more products or services and longer hours, it may be time to expand to meet these demands. Hopefully, your expansion will satisfy customers, increase sales, and make up for the money you invested in expansion. If you have a physical location, you might want to consider opening a second location if your customers have to travel a long distance to get to you.
If there isn’t a demand, why not? Can you create the demand, or is it a case of waiting until the world catches up and realises it needs this? All these questions should be on the tip of your tongue before you invest in this, and choosing to step back and take in the bigger picture will enable you to assess how well received this expansion will be and what you can expect once you have taken the plunge.
People Are Seeking You Out
How long have you spent trying to identify your ideal customer? A hot indicator that you are primed for expansion is that the tables are flipped, and instead, people are coming to you with little to no effort on your part. Exceptional customer service or top quality products and sales can solidify your reputation and allow you to hone your reputation as the go-to business in your industry.
Once you can back up what you offer, word of mouth will be a powerful thing. People will continue to come back time and time again if they trust you and your company, and this is a huge tick when it comes to making your mind up about expanding your business.
Did you know that small to medium businesses are the main drivers of economic growth? And as the economy has taken a downturn of late and many businesses, big small businesses and larger established companies alike have felt the hit, as have those who have been slow to adapt to the changes in which people do business.
Keeping your finger on the pulse of what is happening in both your industry and the economy as a whole can help you to stay ahead of the curve when it comes to adapting your company and assessing whether or not you should be expanding your business.