James Metcalfe
For many, the idea of expanding your own business into new fields and markets is seen as the epitome of a success story. However, those in the industry will always warn of the dangers and issues that can surround expansions at the wrong time and in the wrong settings. Below are some of the very best expert tips on when and how a business can most successfully make the leap and expand.
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#1 Don’t Jump Straight In
I was the owner of the Adam Cole School of Music, sole proprietor, sole teacher. I had a friend who taught voice and I invited her to teach a few students with me. She came back with, Well, have you thought of expanding?
We didn't simply jump in. We looked at our neighborhood and saw that there wasn't much competition. We also knew that the neighborhood was improving and there would be an influx of people and wealth to the area.
It was our contention that we should get started now and position ourselves well before the boom really got underway, so that any competition would take second place in the minds of our clientele.
Contributor: Adam Cole from grantparkarts.com
#2 Don’t Restrict Your Earnings
We made sure we had enough options to diversify our offerings so that we were not going to be dependent on one source of revenue. We ensured that we could find a location that was within our budget, and that we had sufficient capital to get started.
A year later we have a successful business and the excitement of the whole community! I'm very proud of what we've done, and I'm glad to be able to share our process with others.
Contributor: Adam Cole from grantparkarts.com
#3 Saving Up A War Chest
Too many companies make the mistake of expanding when they see things are going well, but they don’t have any retained earnings in place. The reality is that it takes money to expand. You have to have some dollars in reserve before you make the leap to growth, or you won’t be able to afford those new workers on the payroll and the increase in working capital. I’ve seen too many entrepreneurs get excited about growth, and they do it before having some financial reserves, only to have to re-trench six months later.
Contributor: Lisa Shepherd from themezzaninegroup.com
#4 Get Your Operations Sorted
If you have your business processes well organized and can delegate about 80% of the tasks that need to be done, then it’s a reasonable time to consider expanding. Until you have this in place, it’s dangerous to expand because you as the owner will be able to attract new clients, but you’ll just let them down because you won’t be able to meet their needs or expectations. This is worse than not expanding at all.
Contributor: Lisa Shepherd from themezzaninegroup.com
#5 3 Year Profit Rule
You've seen a profit for at least three years: If you've been seeing consistent profit, you know that what you are doing is working and it might be time to make that leap and expand.
Contributor: Nate Masterson from mapleholistics.com
#6 Expand To Fit Your Means
Initially, my business was providing services on a one-to-one basis. Eventually, the demand for our content grew to the point that we couldn't meet the demand and remain with a one-to-one delivery model. We diversified how we deliver content and moved toward webinars, online courses, automation - an overall shift toward a one-to-many model. These changes allow our clients to still get their needs met, the company to make smarter money, and saves our small staff tons of energy. It's a win/win for everyone.
Contributor: Jennifer Way from caffeinateyourcareer.com
#7 Be Smart With Your Hiring
We are always cautious and make sure we are not expanding too quickly to avoid being top heavy with staff. Thankfully, this has paid off and we have never had to lay off employees. We are slow with our hiring process and always wait until our current team is having to work overtime on a regular basis to get the job done. That is the point we feel we have a workload that can sustain another hire.
Contributor: Kelly Edwards from WeAreLMG.com
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