Here are a growth strategies to consider if your company is ready to expand.
Small business optimism has been strong since November 2016, and this has translated to record numbers of business owners deciding that it’s a good time to expand their companies. According to the April 2018 Small Business Economic Trends report, 27 percent of small businesses surveyed believe now is a good time to expand their business, and a net 16 percent are planning to create jobs.
What Is Expansion for Your Business?
A planned business expansion is a stage in which you increase your company’s operations to generate more profit. This can take shape in a variety of ways, including:
- Opening an additional location
- Adding space to your existing location or moving to a larger space
- Offering new products or services
- Entering new markets
- Adding employees
- Acquiring or merging with another company
The first step is to identify what method of expansion works best for your business.
NFIB member Trip Turbyfill, owner of Café Strudel in Columbia, South Carolina, has undertaken business expansion numerous times since he and his wife, Marila, opened the restaurant in 1997. Their first location had roughly 10 tables in 600 square feet, but three years later, they moved to a new location with four times the space. Another twelve years went by, and they expanded again by purchasing and renovating a new space that added 1,400 square feet of space, including a private dining room and covered patio for private-event rental. The Turbyfills also added a full bar and expanded their menu at the time. Now, after their son Kyle has been on board as general manager and executive chef for three years, they are opening a second location in Lexington, South Carolina.
Tackle Location and Demographics
If, like Trip and Marila, you have decided to open an additional business location (or move to a new spot with more space), he says starting with site selection and demographics is the most important thing you can do. Think about whether the space meets your needs, the level of foot and car traffic that goes by, and whether the customers you want to reach are located nearby.
Plan for the Unexpected—But Stick to a Date
If your business expansion involves construction or renovation, Trip advises getting solid numbers for the work, but also planning for cost overruns and delays. Have an emergency funding plan in place in case things get really out of whack, he says.
And, no matter how daunting it may seem, set a date to open. “You need to set a date because you can always find more to do,” Trip says. “If you say, ‘we’ll open in a couple of weeks,’ those two weeks go by and you haven’t opened and then you think, ‘I need to do this or that.’ But if you set a date—we’re opening March 10—and it’s realistic, then you give yourself a target. You may have to change your date, but always change it to another specific date.”
Finally, stay true to your business’ goals. “Don’t listen to naysayers,” Trip says. “Nobody knows your business as well as you.”