4 Important Considerations When Expanding Your Business
As a business owner, finding yourself in a position whereby your company is able to expand, growing its client base, expanding departments, or establishing new locations of operation, is certain to be exciting. A more established business and one with a larger reach is demonstrative of great potential, bringing about new opportunities for profit and venture.
However, to accompany this, there are a number of challenges that arise and business leaders must also adjust their practices, as well as reevaluate their operations, to suit the changing needs of a more significant business.
While each business is certain to have its own nuance, there are four important considerations for those undergoing expansion that are almost universal.
Consult Collaborators
If your business relies upon the work of a collaborator, such as a vendor or supplier, then it is important that you measure your expansion with their capabilities of service. They must be able to assure the same level of quality as your requests increase in scale. This could be the processing times of a distributor or manufacturer, for example. If they cannot offer to grow with you then, to maintain your current supply, you must find a collaborator that can.
You will find that certain collaborators, such as suppliers, may even use the opportunity of your expansion to justify theirs, improving business relationships and growing operations alongside one another. However, if these decisions are addressed early, then there is less likelihood of them occurring.
Estimate Projected Costs
Business expansion is associated with both immediate and projected costs. It is important that not only are the initial finances considered, those that will help a business to afford the fundamentals of its expansion, but also the increase of ongoing costs, such as subscriptions and utilities.
Additionally, internal costs, such as staff salaries must be reviewed and considered, especially with any potential annual reviews. There are also a number of payroll considerations to make too, considering how growth might affect tax obligations, which is why many businesses seek external advice from industry leaders like People Group Services.
Logistical Needs
Expansion comes with a new set of logistics and these must be scrutinised with the same level of detail as your current operation, with aspects such as training and risk assessments being a duplication of quality. If there is any disparity between departments or locations during an expansion, internal cohesion will be lost and a brand or business reputation will become diluted as different methods of operation develop in separate locations.
Team Building
For employees, expansion means the onboarding of new staff as well as an opportunity for promotion, as new internal positions become available. This is a great opportunity for businesses to rearrange their internal departments, offering greater responsibility to those employees who can better support the operation, as well as reorganise any arrangements that currently cause issues. Additionally, expansion often allows an opportunity for the hiring of external talent.
Some businesses will be able to commit to long-term opportunities, offering full-time contracts, whereas others will remain cautious, hiring contractors or freelance staff members until new KPIs are established.