Expansion is an inevitable part of a successful business. It could mean offering new goods and services, opening a new branch, or hiring additional employees to drive growth. However, it must be done right.
Without careful planning and study, a rash expansion decision could drive your business down. Here’s what you need to do to avoid that.
1. Not highlighting health insurance benefits
In expanding your business, you’ll need to hire a larger workforce to run the expansions. New hires will look for incentives for working under you. Particularly health benefits. If you don’t offer health insurance, applicants will not go through the application process because they won’t be covered if they do incur injuries while working in your venture.
Make sure you have an insurance plan ready for new hires and old employees alike.
2. Not growing a web presence
It’s good to open up a new physical store but that store will eventually close if no people from that area will come to avail your goods. For example, if your original store is based in The Bronx, your newly opened branch in Brooklyn will eventually shut down because Brooklyners never heard about your brand or can’t contact you on any social media platform for questions.
Set up a social media or web page then have it shared by residents from both your home base and the new branch. A business that is easily reached brings more customers. This is because customers like businesses that keep a close connection with them.
3. Failure to follow trends
An excellent example of this mistake is opening a new shop when there’s fear on the news of an incoming contagious virus. So you’ve just finished a ribbon-cutting ceremony. Then a lockdown happens tomorrow. There’s no revenue gained from that new shop. It gets closed.
You should always study the market and surroundings first before you make any expansion plans and actions.
4. Neglecting your current employees
A loyal customer base is essential to growing a business. But so is a loyal group of pioneer workers. Just because you’re expanding your business doesn’t mean you should disregard the people who brought you to where you are. It’s very ungrateful.
Reward your employees with a promotion for sticking with you. They’ll keep on doing their best because they have contributed a lot to build your business. Delegation is also easier because a high degree of trust is already established between you and your pioneering employees.
5. Expanding too fast
When there’s a huge demand for business, there’s also a huge necessity for expansion. But that doesn’t mean you should expand too much and too fast. This problem is particularly common among businesses that open a third branch in just a short time after opening a second.
Expansion is costly. Don’t underestimate that thought. Spending more than what you earn can cause you to go bankrupt. Especially if something bad happens out of the blue that could hamper your operations. A good example would be a natural disaster or a stock market crash.
After opening a second shop, keep on marketing, save up for emergencies and insurance. Make the recent expansion self-sustaining first. Then save up for a third expansion. Execute the third expansion plan afterward.
6. Not addressing your customers’ needs
Improving or introducing a new product is also an example of business expansion. Don’t change a formula that’s perfect. Don’t introduce a new product that has no demand. Wait for a majority of your customers to make a suggestion first before taking any expansive actions.
Remember, customers are the #1 reason that businesses exist. Addressing their needs properly is what makes them loyal. And when they become regular patrons, the survivability of a business increases significantly.
Solopreneurship is like being a general of an armed force. You need to make the best out of your resources. Careful planning and execution for moving forward are paramount. You must treat your subordinates with respect, care, and fairness. Failure to do so will result in a costly defeat. In this case – a failed venture.
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