Editor’s Note: Here at Dispatches, we are always looking for ways to help our readers do things. For some of our readers, that means helping navigate the working world, for others, it means assisting in the ever challenging question,“what’s for dinner?” For still others, it means figuring out how to balance family life with everything else. In an effort to aid in all of these endeavors, we have collaborated on this article written specifically for our readers.
When a business reaches a certain point, it has to expand. That might be growing from a solopreneur to adding an employee or adding more employees. There are risks involved with growth but there are also risks involved with not growing. You can mitigate some risk by preparing in advance and creating a solid plan. Below are a few items to make sure you plan for when expanding a business.
Everyone knows that you need a business plan when you start a business. You also need a solid and detailed plan when you are about to undertake an expansion. Consider creating an expansion plan that will discuss potential challenges and solutions. Make sure you take the time to think through all possible issues. This plan will act as a roadmap.
Reasons for Expanding
Expanding a business is never something that should be done lightly. It’s something that should only be done when there is a real reason for expansion. Maybe the business in its current form simply isn’t sustainable. Or maybe it needs to expand in order to meet demand. Whatever the reason for expanding the business is, it’s vital that you have a reason. Many business owners take on an expansion too soon, without a real reason. Consider your options carefully and evaluate whether or not your business really should expand right now. There is no sense in rushing into an expansion if it won’t help the business.
A Suitable Workplace
If you do decide to go ahead with an expansion, making sure you have the workplace in which to carry it out is key. When you are hiring more people, taking on bigger challenges or doing more work, then it’s only sensible for your workspace and location to grow. Many businesses move into bigger offices or workplaces when they expand. It’s a natural progression. If you do decide to purchase a new office or workplace, you need to do it carefully. Bannister Preston, commercial conveyancing solicitors can help make the process smoother for you if you’re in the UK. Here in the US consider contacting a local realtor who specializes in business locations.
The Right Skills
For the expansion to succeed, you’ll need everyone to be pulling in the same direction. If you really want your business to grow and succeed, you will need to make sure that you have a good balance of skills and competencies in your workplace. Hiring new people to fill those gaps in your workforce will probably be necessary. And hiring people is a process that should never be rushed. If it is, it can cause the business to hire the wrong people, and that can have repercussions for years to come. When you hire someone, take the time to interview them a couple of times and understand their skills and experience properly.
There really is no replacement for experience. You have a team of young and talented people, but if they don’t have the required experience, they will struggle. An expansion is one of the most testing times in the life of a business. If you can, hire people who have been in this position before and can use their experience to guide the company.
Expanding a business costs money. Finding the capital required to get the expansion underway can be difficult. Many business owners turn to investors when they need the money to make the necessary upgrades. This is a good option, but finding someone to invest in your business and pay for its expansion is not always easy. It’s preferable to rely on the money that the company has already made while in business. This keeps the business independent and free from interference.
Tax and Legal Preparations
There are many things that will change for your business when you expand it. If your company’s revenue is set to increase dramatically, you could find that tax laws change. If you plan to start expanding into foreign territories, you will need to think about how this will change your business. All countries have their own laws and tax systems. You will have to understand these before you start to think about expanding into those countries and selling to customers there. This is where an expert in this area is critical to your success.
A Plan B
Have a plan B in case something does go badly wrong along the way. This plan should give you an alternative way forward when things don’t pan out as you’d hoped. Having a backup plan does not mean that you’re admitting your plans will fail. It’s just a sensible way of making sure that you are prepared in case things don’t work out. It would be foolish not to put some kind of contingency plan in place before you begin the process of expanding your business.