Is it time to expand your business?
A new year has dawned and along with it comes big dreams, plans, and objectives. It’s easy to dream of expanding your business in a new year, but is it the right time?
The start of the new year usually brings with it new resolutions and plans. We plan to be better, to be more successful, and to make it a positive year. These are all great goals to work towards, and as a small business owner, you probably have the same goals for your business.
READ: 5 things to do when you reopen your business after the holidays
Expanding your business might seem to be the answer to all these goals, and who doesn’t want great success. However, you need to ask yourself whether expanding your business is the right thing for you to do right now. Is your business ready to expand?
Here are five key points to look out for when making this decision.
1. Your team is ready
When your team of employees are working at optimal level, with space for capacity and the ability to handle any extra pressures, you could be ready to expand your business. You must trust your team and their abilities to handle the extra pressure of expansion, as well as the increased workload. Be careful of placing too much pressure and work on their shoulders though, you don’t want your employees to be unhappy. If you don’t think your team is there quite yet, invest in some training and provide some mentoring as well.
2. Strong customer base
You have a reliable customer base with recurring and guaranteed orders. Having a strong and dependable customer base is very important for expansion. Repeat customers ensure that your business succeeds and should provide you with enough confidence to make the move to expand. Just be careful that you don’t neglect your loyal customers when you’re busy making your business bigger. Remember that their support got you there.
3. Your books are in the black
If your business has been making a steady profit and your cash flow has been looking good for a reasonable amount of time, then it might be time to think about expanding the business. Having good cash flow in your business provides you with a foundation to build your business expansion on. An expansion can cost quite a bit, even if you do have financing, so make sure you have enough money in the business to cover costs and to carry you through the expansion.
4. You need more space
Sometimes an expansion is something as simple as getting bigger premises. Your business might have grown to the point where you need more space to run it more efficiently and to accommodate your staff and products. If this is the case, ensure that you do your research on the best area for you and that you also find premises that fulfils all your needs. It would be best that you speak to a property management group like Ithala Development Finance Corporation to help find something that fits within your budget, and that provides all the facilities and space you need.
5. Your industry is growing
If your industry is experiencing growth, and you also see a need for related products and services which you can provide, then it might be time to expand. A stagnant industry is the enemy of expansion, so if you’re thinking of it while your industry is standing still, you might need to pause your plans. But if you’re seeing a growth in orders, new technology, and products coming to the fore and an increase in customers and interest, then it might be worthwhile to strike while the iron is hot.
For more tips and inspirational stories visit the Ithala blog at www.myithalastory.com.