If you’ve got to this stage, then a massive congratulations is in order. After all, we all know the terrible statistics about businesses failing in their first years– and particularly in the current economic climate, beyond then.
However, while expansion is something to be celebrated, in truth it is just the beginning of another journey. It is something that can bring monumental rewards, but at the same time it will throw you out of your comfort zone and there are risks attached to it. Without trying to produce any scaremongering tactics, it has been known for once-successful businesses to fail after attempting to expand.
Bearing this in mind, we have prepared today’s article. We will now take a look at some of the most common mistakes that are made by those business owners who are attempting expand their company.
You don’t think logistically
One of the biggest mistakes that a lot of business owners make is just having their eyes set on the final result, rather than the practicalities involved with their strategies. They just think about the larger orders, or the bigger customer numbers, and forget that they logistically have to serve them.A possible solution for this is to consider business storage options to store the increased number of products or assist with the transportation of goods. However, both of these problems can still prove to be huge stumbling blocks. For example, in relation to transportation, you might have built up a really good relationship with a local operator and got used to their lower than average prices. Now you are expanding, will they be able to cope with your new demands?
You don’t understand your customer
Next, is more of a strategic issue. A lot of businesses have experienced success in one market and then automatically believe that they can take this to a new one. This might be in a different sector, or in a different region.
Whichever it is, it brings different challenges. Believe it or not, customers are different in different regions, and might not take warmly to your business in a new area. You need to make sure that you thoroughly understand the market so you know that expansion is the right decision.
You don’t listen to the market
When we talk about listening to the market, we’re no longer referring to customers.
This time, it’s all about the industry itself. In other words, what is the general vibe at the moment? While your business might be experiencing great success, this might be out of the ordinary. In reality, the market that you are operating in might be shrinking, which means any expansion move might be more difficult than you first imagined.
Ultimately, the key is keeping on top of business trends and news as much as possible. If you are starting to see a shift in the way customers perceive your industry, and their actions are changing, make sure that you take this into account before you take the plunge and opt for expansion.
