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.
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