It’s exciting to expand a business!
Finally, after working so hard to make the business work, you probably can’t wait to add more branches, offer more products, or expand to new territories.
But hold your horses first…
Before you expand, make sure you have the right fundamentals in place.
What do I mean?
Here are some examples:
You should check that your supply is stable and can accommodate the increased demands. The last thing you want when you expand is not having stocks to sell in your new branch.
You must have the people in place to handle the new businesses that will come in. Is it going to be managed by the current employees or are you going to hire new people? Who will handle sales and customer support? What’s their incentive scheme?
Your pricing, cash reserves, and profitability must also be right. It should be able to handle new expenses related to the expansion like logistics, rental and manpower. It’s much easier to make changes to the pricing when you are still small so fix it now.
How about your trademark? Have you already registered your logo to protect yourself from potential copy-cats? You should, before it’s too late.
These are just some of the things you need to fix first before you expand.
Otherwise, when you expand too soon, you will just multiply the problem and turn off more customers.
It’s like voluntarily getting a rock and then hitting your head with it. Many have done it but I hope you won’t…
What other things should an entrepreneur consider before expanding a business?