If you own a business, you’re probably aware that time never stands still. There’s always movement in the market, and you may find that your sales soar and drop. Most people go into business with a view to expanding their initial venture and growing the company, but how do you know when it’s the right time to take that next step? If you’re considering your next move, here are some signs that you may be ready to expand.
You’re turning over a profit
Financing a business is no mean feat. If you’ve got a relatively new company, it can take a long time to cover the costs of getting it off the ground, and you may find that you’re surviving rather than flourishing in the first few years. Although it may be tempting to plow more money into the company, especially if sales are booming, it’s wise to be cautious. Just because you’re bringing money in doesn’t mean that you’ll be in the black and it’s best to wait until you are making a profit to invest more. Keep a close eye on the books and get to a stage where you can afford to finance the next step, or you could put forward a good case to an investor or a bank if you’re thinking of borrowing money.
Demand is increasing
You don’t want to invest more money and devote more time and energy to a venture that is struggling to attract interest as it is. If demand for your products or services is growing by the day, this is a fantastic sign. However, if you’re finding it difficult to close deals or you’re losing out to competitors, try and address these issues before you aim for growth. Think about why you’re finding it tough to generate sales and try and find solutions. Are your prices too high? Are you using the wrong marketing techniques? There’s no point in having brilliant adverts or promotions if you’re not targeting the right customers or getting messages through to them. It’s common for new businesses to go through purple patches where sales increase rapidly. If this is the case, resist the temptation to go in all guns blazing and adopt a measured approach. If you’re selling out of a product and you’ve got a waiting list, by all means, increase production, but tread carefully, especially if you have a seasonal business. You don’t want to scale up the business to find that a month later you’ve got a team of staff twiddling their thumbs and a load of surplus stock.
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You’re prepared for growth
Expanding a company isn’t just a financial move. As well as considering how you’re going to finance the next stage, you’ll also need to consider whether you’ve got enough staff, whether you need to think about logistics and how you’re going to turn plans into reality. Have a look at your rotas and staff numbers using an employee scheduling app and work out if you could cope if you were to open a new shop or a sister restaurant or you were to put plans in motion to start developing a new product. It’s highly likely that you’d need to hire new staff, and it’s worth considering all the options. You don’t want to open a brand new store and have customers leaving negative reviews because you haven’t got enough staff to serve them. Use the structure and the scheduling techniques you have at the moment to estimate how many members of staff you need to recruit and start the process several weeks before you plan to open. This will give you time to select the best candidates and train them. You may also need to think about buying or hiring new equipment or expanding a fleet of vehicles. Cost every item and make sure you have watertight plans in place in advance.
You have an established client base
If you’ve got customers coming back again and again, this is a surefire sign you’re doing something right. If you have an established client base, prioritize your loyal customers and keep them on side. This is your easiest sale. While doing this, make an effort to reach out to new customers, but don’t ever underestimate the importance and value of keeping existing clients.
If you’re thinking about expanding your business, you may be wondering how to find the right time. Hopefully, these pointers will help you to plan your next move and execute it seamlessly. You may need to take risks to grow your business, but it’s always worth doing your homework and ensuring you take calculated risks.