Every business strives for expansion. In a growth-forward economy, business expansion is more than just an opportunity to grow profits; it is also crucial for business survival. This has been proven particularly true by the inflation crisis and ensuing recession, as spending plummets alongside spending power.
But expansion is not quite as simple as recruiting more, or opening a new physical location. Even these simple options have their own considerations attached. What follow are some of the most important questions you should be asking with regard to your business’ expansion – along with some of the better ways to secure a successful expansion strategy.
What are the Costs?
Unfortunately, growth always comes at a cost for businesses – whether in the form of time, effort or money. Expansion into a new market or territory requires all three, but perhaps the most important of them is the latter. You will need to invest in a number of things, from new premises to new marketing strategies and supplier pipelines.
If you are expanding regionally or even going international, your leading concern will be establishing a new regional base of operations – requiring money to secure premises and new staff alike. Expanding your product or service range requires research and development investment, as well as new PR strategy.
While these costs are certainly worthwhile, they can also be damaging for the unprepared business. You should draw up as comprehensive a budget as possible, taking into account logistical and administrative costs as well as big-ticket investments, and measure the result against your business’ current cashflow. If there is little wiggle room, more seed funding is needed to ensure your business is not negatively impacted.
Do You Need Support or Advice?
Whether you are moving into a new market or a new regional territory, your business will be expanding into new ground – literally, legally and regulatorily. Tempting as it may be to keep your expansion simple, and to manage as much as you can in-house, this can lead to ineffective expansion and potential compliance issues further down the line.
Seeking counsel from independent consultants can be a vital part of the equation for your expansion. Expert advice can help you navigate new legislative waters when instituting a new branch in another country, or help you understand your specific legal obligations in a new industry.
What is Your Expansion Plan?
While this question may seem broad, it contains within it some key considerations you should make before you begin to make any serious in-roads. For one, a successful expansion is one in which every stage has been planned out as comprehensively as possible.
A good timeline for your expansion process enables your workforce to coordinate and collaborate more effectively. Meanwhile, failure to account for certain variables can see expenses balloon or rollouts postponed, throwing the security of your business into question.