Your business is doing well. You've successfully navigated the rocky road that all new businesses must traverse and you've come out the other side better and stronger. So what's next? It's time to facilitate growth. This can be daunting, regardless of how much experience you have.
There are many ways to grow your business, but for retailers and healthcare providers, opening a branch in a second location is a logical next step, though not without its own challenges. Here is Innova Design's quick guide to expansion, how to know the time is right and what you'll need to do to prepare.
When is the best time to expand my business?
There are several factors that may push you to consider acquiring a second location for your business. Maybe you have more business than you're currently able to handle? Perhaps you have a strong customer base that is invested in your growth? Have you run out of physical space in your current location? These are considerable factors, however, the most important are as follows:
- You've run a profit for at least three consecutive years,
- You have a steady cash flow,
- Your employees are a strong team of reliable workers,
- You have proven and efficient operational systems.
Before you make any decisions to expand, it's important that you measure your strengths. Expansion becomes much more difficult if any of the above are missing, so it's of great importance that you make sure you're strong enough to grow. Not simply in terms of having funds available, but being sure that the process won't hinder your current operations, and that they can proceed at full efficiency while your attention is elsewhere.
How much market research do I need to undertake?
The short answer is, as much as possible. It's important that your second location will be as sustainable as your initial business. Understanding your market is key, but understanding the nature of your market is essential. Is your industry growing? Are there competitors in potential new spaces? Does your target demographic exist in multiple places or are they "native" to your current location?
Consider the long term feasibility of your new site. A popular restaurant may be able to open a second location within walking distance from the first, however this won't work as well in a retail or healthcare setting. It's also necessary to understand the demographic that already exists in potential new locations, and consider implementing marketing strategies to bring clients into the new branch.
How will I find the right location?
This is one of the most difficult aspects of growth. Your decision t o expand to a second location may be driven by an area you like, but there are a huge number of considerations to take into account on top of your market research. The actual health of the space you have your eye on is of high importance.
A new site may be in the perfect location to serve your market, but how much will you need to spend on fire protection, HVAC, electrical outlets and other compliance issues? Market research will take you a long way, but it's crucial you have a property expert in your corner to help you understand the true cost of your chosen site.
Innova Design is a specialist in interior design, fit out and construction in the retail and medical sectors, and we've helmed roll outs nationwide. When the time comes for you to expand, we're here to help every step of the way – from market research, budgeting and site feasibility, to a completed project ready to open for business.