After achieving success in your first business location, there comes a time when you will look to expand by reaching new territory. Whether it’s opening a new store a few cities over or taking the company global, it will be a complex issue. As such, it’s imperative that you do it in the right style. Here are 10 questions to ensure that you do.
By Team Savant
Image: K8
Q1. Is there an audience?
Market research will play a huge role in deciding if your business blueprint can succeed in another location. Ultimately, if you can’t find an audience in the intended destination, it’ll be better to look at other solutions.
Aside from confirming that your business can have a future in the new location, this step will help you build your target consumer profile too.
Q2. Could the territory be reached through digital methods instead?
Realising that there is a potential for your business to reach a new audience doesn’t always mean that a physical expansion is needed. In some cases, you will find that launching a new website supported by local SEO will work. Especially when you accept the local currency.
If selling digital products like software, the process should be quite straightforward. When selling physical products, working with couriers and order fulfilment teams will be key.
Q3. Will your construction plans get the go ahead?
Finding the right location for your secondary project isn’t just about the nation or city. You also need to know the legal limitations before starting any construction on building work. Experts like Andrew Long and Associates can complete the major project planning phase.
This will help you avoid a major mistake, and help you act with confidence when taking the next steps. It also prevents upsetting your future clients.
Q4. Do you have the funds?
Even if you have a great business idea and have every confidence that it can succeed in a second location, you need capital. Attempting to make things happen without the necessary budget will inevitably see the secondary venue fail. Before it even truly gets started.
The success of your existing business may support your hopes of securing capital. Alternatively, outside financing may be possible.
Q5. Which departments are needed?
Even when taking on a major project in a new location, you want to reduce the financial risks. Outsourcing some departments, such as HR or customer care, may help you achieve this. You’ll face fewer expenses in the initial outlay, which can minimise your exposure.
Meanwhile, you may find that some tasks can be completed digitally from your main HQ or business premises.
Q6. Could franchising work out better?
If you do not have the resources or time to expand to a new territory, there are other options. Turning the company into a franchise can work wonders. You’ll only see a percentage of the profits, but the workload is far smaller. This can be a very attractive choice.
Once the process has been completed once, you can repeat it with new franchisees. This will allow you to reach multiple locations far sooner.
Q7. Is it logistically the right environment?
As well as checking that people will be interested in your products, you also need to consider zonal pricing and other features. Likewise, some businesses and manufacturing practices will be impractical in certain locations. Ultimately, all aspects must be considered.
But when you’ve done the research into financial issues, transport, and resources the process ahead can be streamlined.
Q8. What are your goals for the new venue?
When you take your business to a new location, you must also accept that it might not repeat the success of the first venue. Therefore, setting realistic goals for the new business addition is vital. In turn, this can guide all future decisions.
In short, you need to think of this as a separate entity. Whether it’s making a difference or simply hitting a sales target is up to you.
Q9. How active will your role be?
Some entrepreneurs will see a secondary location as their new baby. But if you don’t want to keep travelling back and forth, you don’t have to. Services like Upwork can team you up with project managers. With the right team at your disposal, you can play an overseeing role.
Thanks to modern tech, staying in touch with on-site teams for short and long-term situations can be made easy.
Q10. When?
Finally, you must ask whether now is the right time. Exiting the pandemic can present both opportunities and obstacles. Weigh up the pros and cons to make the right decision.