When Should You Start Expanding Your Startup Business?

When Should You Start Expanding Your Startup Business

If you are overthinking whether to expand your business, here are some signs that it might be time!

When you are just starting out your business, the focus is usually taking one step at a time to get it up and running and maintaining stability after that. It is easy to lose track of when to stop and consider that it’s time to expand your business. 

In 2019, the Indian budget hotel chain, Oyo, expanded to the U.S. by collaborating with real estate investor Highgate for US$135 million. Most businesses would want to follow in their footsteps and find ways to effectively expand. But how would you know it’s time to finally take that step for your startup? Here are a few clear indicators that business expansion should be on your radar!

You have a regular customer base

If you have a loyal customer base that keeps returning to you time after time, it might be the right decision for you to expand your business. This is a clear sign that your business is satisfying a need that won’t go away anytime soon. This is particularly true when ‌customers are returning without being compelled to do so, such as through a contract.

Your customers begin demanding more out of your business

With a repeating customer base, one of the things you might experience is a growing demand for more products or more locations. This is also a great indicator of a business that needs expansion. If your customers need to travel a long distance to reach your storefront, consider opening a second location; if you see rising interest from international clients on your digital storefront, research ways to expand shipping internationally. 

Your industry is growing

If you see your collective industry growing, that might be a great opportunity to expand your business. It is crucial that you regularly study your industry trends to best plan the direction you need to take your business in. If your industry seems to have a weak foundation, then expanding might just end up losing you money and time. 

One of the ways to test whether expansion would help you see monetary returns is by testing the waters on a smaller scale. You can accomplish this by expanding first in the local market. If that proves to be fruitful, then you might want to start planning for a regional or even global expansion. An important point to remember when considering expansion is that even if your industry might not be growing, there is still room for growth, provided that your products stand apart from competitors and provide the consumers with a unique service. Your growth could, in turn, help the industry as a whole reinvent itself. 

You have regular profits

If your business’s net income has been consistently on the rise, it is high time you consider expanding. However, don’t just rely on short-term patterns; such increased income should be something you observe over a long period of time. Investing your profits into the company’s growth will help you see even higher returns in the future. 

You are either overworked or running out of space

When your business is bringing in more clients than it can handle, to the extent that you need to turn away customers, it might be time to expand. Expanding, either physically by shifting to bigger spaces (as in the case with restaurants or physical stores) or by hiring more employees, can help you meet this growing demand. New employees can help you come up with new ideas to bring in more customers.

Even if they are applicable, you must still consider whether your business is actually ready to expand. If you push yourself too soon, it might be hard to keep the momentum going. Make sure you do enough market research and devise action strategies that are specific to your needs before you jump headlong into expanding.

Header image courtesy of Unsplash

SHARE THIS STORY

Share on facebook
Share on twitter
Share on linkedin
Share on email

RELATED POSTS

New to the Forex Market The Ultimate Toolkit for Success

New to the Forex Market? The Ultimate Toolkit for Success

Foreign exchange trading can be a tricky business. When it comes to choosing what tools will be the most effective in your forex trading journey, there are a few aspects to consider. Whether you are a brand-new trader or a seasoned veteran, some of these tools will always be handy to help you not only find the diamonds in the rough but also stay focused on your goals.

Looking Back on the Top Skincare Trends of 2022

Looking Back on the Top Skincare Trends of 2022

Going makeup free during the COVID-19 pandemic has whipped up interest in skincare, with people spending more on in-clinic aesthetic treatments and buying more skincare products. As of 2022, revenues in the beauty and personal care industry have reached US$534 billion. Of this, the skincare segment makes up a total revenue of US$153.30 billion, growing at a CAGR rate of 5.19% in the next five years.

Is It Ethical to Be “Overemployed”

Is It Ethical to Be “Overemployed”?

According to the American Bureau of Labor Statistics of August 2022, more than 7.5 million workers in the U.S. are overemployed, that is, they hold more than one job. With the pandemic leading to an increase in remote working and making people concerned about job safety, it doesn’t take a genius to see why people would choose to work multiple jobs.

Kanye West’s Biggest Losses of 2022

Kanye West’s Biggest Losses of 2022

Singer, rapper and chaotic personality Kanye West, a.k.a. Ye, has been all over the news and the place for the past few months. What’s more? Media personality Kim Kardashian is not all that he has lost. The famous rapper has also lost his billionaire status as his over-a-decade-long relationship with Adidas ended following his antisemitic (i.e. against the Jewish community) comments on social media. Now, he is worth US$400 million.

Top 5 Covert Signs of Sexual Harassment

Top 5 Covert Signs of Sexual Harassment

One of the gravest threats to a workplace is sexual harassment. Although commonly believed to be a situation only women go through, sexual harassment can be experienced by a person of any gender or sexual orientation. According to an analysis conducted by Gapjil 119, an organization that assists with workplace abuse, eight out of ten workplace harassment victims end up facing some form of retaliation from the aggressor, like getting turned down for a promotion or threatening their job.

Are You Being Quietly Fired?

Are You Being Quietly Fired?

In a previous article, we discussed how the modern workforce is expressing their discontent with their working conditions by quiet quitting. Quiet quitting means simply doing what is expected from employees instead of being emotionally invested in the jobs and going the extra mile for companies. Now, employers have taken a page from their employees’ books and begun using quiet firing to reduce the number of workers.