You know how important it is to do what you love. So what do you do when what you love makes you really successful? Do you stay a one-person (or one location) operation? Of course not. You expand!
Well, it isn’t exactly that easy. Deciding that expanding is a good idea and actually making it happen for your sweet little enterprise is something else entirely. Still, if it’s what you think is best, here are some tips to help you do it.
Look at the Numbers
There’s a difference between doing well and doing well enough to expand. A lot of entrepreneurs and small business owners move too quickly with this. They think that a few months of ending in “the black” means that they are ready to take on the huge expense that is opening another business. Don’t make this mistake! Instead, wait until your business has built up enough of a reserve to keep your current operation afloat for at least a couple of years as well as fund the building, staffing and marketing and running of a new location for the same amount of time–yes, even before you try to talk to a bank about loans.
It’s a good idea to talk to your accountant as soon as you make the decision that you want to grow and expand your location. You can start setting aside funds for expansion. This way you won’t be tempted to spend them building your current location.
Find a Location
Sometimes it’s a good thing to start small–opening a second location in the same town but a different neighborhood is one way to do that and it’s what a lot of entrepreneurs and small businesses do.
It’s better though to go to where your customers actually are. For example, you’ve obviously put your business online by now and are likely taking orders for your products through your website. Where are those orders going? Do you have a huge buyer base in another state or city? Look into setting up a second location there. Another option is to look for locations that are offering tax breaks to new businesses. A lot of states have tax incentives to help bring in new and expanding businesses. It might be more profitable to open up a location where you can run your business with reduced taxes or even tax-free for a while to help build up your profit margin.
You might, if the numbers are right, even consider expanding your business internationally. Going global is something that a lot of entrepreneurs dream about. And remember: even if you’re based in Grand Rapids and decide to open a location in Toronto, it still counts as becoming an international operation!
Plan the Move
Opening a second location means things like finding office or shop space and then filling that space with inventory, furniture, etc. Many small businesses will supplement a new shop with overstock from their original location. This is easy enough to do when you are running two locations in the same town. If you’ve expanded to a different city or state, though, you’ll want to work with a logistics coordinator. This is particularly important if you are going to be expanding into another country. You’ll need to work with a coordinator who can facilitate air cargo carriers, customs, and other issues that, to put it bluntly, you cannot do on your own while simultaneously running your business.
Get Used to Traveling
Your new location is going to require a lot of your attention. This is true even before it is officially opened for business. You’ll need to scout physical space, hire a location manager, help with the hiring of employees and oversee all of those “getting up and running” details that you took care of when you first started your business. A lot of entrepreneurs choose to move, at least temporarily, to the new city so that managing the details is easier.
Expanding a business is a great and important and ultimately complicated process. Go slowly and resist the temptation to skip steps!