Five Tips for Expanding Your Business

Expanding your business is, quite honestly, a lot like starting it. The steps, paperwork, and investments are all similar. Despite that, there are a few key differences that trip up small business owners. Expansion takes place over a much longer period of time, and you have to be careful not to hurt or ignore your original business while expanding into new markets. MyCorporation was actually suffering from over-expansion when I took it over, and there is nothing worse than having to forcibly shrink a company. So, to help other business owners avoid that unfortunate process, I usually give a few tips to those looking to expand.

Plan, plan, plan

The problem with our expansion under the previous owners was it was not an organic process. The company was structured in a way that put a strict time frame on the very lofty goals those in charge required of middle-management. Planning, if it was ever done, focused on the short-term. Before I decided to try expanding the company myself, I knew I had to specifically plan every move I made. That means setting milestones, sticking to budgets, and even having a way out if my ideas were not working. What do you want to do? Tap a new market? Enter a new city? Offer a new product? Track the steps towards that goal so you have a way to gauge how your expansion is going. There were a couple of times where I felt we spent too much and achieved too few milestones, so I backed off, re-wrote the plan of attack, and tried again.

Beg for Criticism

Once you have your plan written, beg anyone and everyone to take a look and talk through it with you. Parents, spouses, colleagues, old professors; really use your professional and personal network. It doesn’t matter how well trained you are, or how much experience you have, there will be something you missed. Expansion is a serious commitment of time, capital, and energy so, while it can be hard hearing criticism, the more holes poked in your plan, the better off you will be after you fill them.

Scale everything

One of the biggest misconceptions about expanding your business is that it happens all at once. You just decide to open a new store, or target a new demographic, and then you follow through. That simply is not the case. Expansion is best done through scaling. That was actually our biggest problem before I took over – management hired tons of salespeople, without investing in anything else. So while we got more orders, our infrastructure, equipment, and sale process never grew to match. This quickly became a logistical nightmare. Orders were dropped, people were upset, and we risked losing customers. After I scaled back, I invested in streamlining our order processing and filing before I started to salespeople back on so, when we did get more customers, we could handle them. It doesn’t matter if you’re looking at another location, or hoping to bring on different customers, or trying to sell something new. You need scale your business proportionately so it can support your goal.

Keep Customers Informed

When you finally start expanding your business, it is a good idea to let your customers know. You don’t have to share every, little detail, but a broad overview of what you’re doing shows your regulars you care about their business and want to explain why everything may feel a little hectic. People like to support their favorite businesses, and they will appreciate that small gesture. Generating a little buzz can only help your expansion efforts, so don’t shy away from this marketing opportunity.

New Licenses, Permits, and Registrations

Finally, don’t overlook any new legal paperwork you need. Heading into a new city means permits, licensing, and registering with the local tax board. Bringing on staff could affect your benefits package and tax brackets. A new product or service might require extra insurance or compliance with new regulations and laws. Make sure you fully research what you are getting into so that your expansion is not hindered by a misfiled or forgotten form.