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Home›Blog›Small Business›8 business expansion considerations to make before
diving in



Small Business



8 BUSINESS EXPANSION CONSIDERATIONS TO MAKE BEFORE DIVING IN

By Kim Mercado
Jan 3, 2022

6 min read

If you've been running a successful business for a while, you may be thinking
about expanding your operations. This may mean offering new products and
services, adding new clients to your roster or opening new locations.

Expanding your business isn't something you should rush into. No matter what
vision you have for your company, it's important to have a business expansion
strategy so you're prepared for the future. Here are some things to consider
before you begin making changes.


1. KNOW WHAT YOUR GOALS ARE

What are you trying to achieve? Do you want to meet a certain revenue goal, work
with a new type of client or expand your geographic reach? Before making any
changes, it's important to have a clear understanding of your goals so you can
align your business growth efforts to achieve them. Scrap any activities that
don’t support your goals.



2. DO YOUR HOMEWORK

Expanding your business is a big decision. But just because you have big plans
doesn't mean the market will support them. Before adding new products and
services, searching for new clients or opening new locations, make sure there's
a demand for what you're offering.

You can conduct customer focus groups or surveys to gain insight into what
customers want, and research trends in your industry to find out where growth
opportunities exist.



3. HOW WILL YOU MAINTAIN QUALITY?

If you try to do too much too fast, you risk having the quality of your products
and services slip and disappointing customers. That's a surefire way to prevent
them from coming back again. Having systems and processes in place to maintain
quality can help you continue delivering products and services that meet the
standards your customers have come to expect.



4. HOW WILL YOU HANDLE THE EXTRA WORKLOAD?

You're only one person. You can't do everything alone, even if some days it
feels like you do. Expanding your business will create extra work, and you need
a plan for handling it because working around the clock isn't sustainable
long-term.

Will you hire additional employees? Or maybe it makes sense to work with
contractors until you get a better idea of the scope of the work that will
continue after you put your business expansion plans into motion.

Bringing on new employees or contractors is an investment and hiring the wrong
people can cost you time and money. Figuring out exactly what the
responsibilities of the new hires will be can improve your chances of bringing
the right people on board the first time.



5. BE MINDFUL OF THE CULTURE

If you've been operating as a solopreneur or have only a handful of employees,
it's easy to ensure the work everyone does is aligned with your business's core
values. As you grow, it becomes more difficult because everyone brings their
past experiences with them. They may have different values, standards and ways
of doing things than you do.

As you expand and bring more people into your business, you may need to be more
explicit about your expectations and the values you want to uphold. Doing so can
help create a cohesive workforce that's on the same page day in and day out.



6. IDENTIFY TRAINING OPPORTUNITIES

If your expansion leads to new responsibilities for you and/or your employees,
you may need to invest in training to get everyone up to speed. Don’t assume
you'll figure things out as you go. It could end up costing you time and money.


7. REVIEW YOUR FINANCES

There are two main ways you can fund your expansion — tap into your cash
reserves or get a business expansion loan. You may want to consult a
professional to help you decide which — if any — option is better based on your
current finances and the additional expenses and income expanding your business
will generate.

Securing financing may take longer than you think. If you believe financing the
purchase of additional equipment, inventory or other items will be part of your
business expansion plans, line up your funding as soon as possible.


8. REVIEW YOUR INSURANCE COVERAGE

As your business grows and changes, it's likely your insurance needs will too.
It's important to review your coverage to make sure it will continue to provide
the protection you need as you expand. 

You may need to modify your existing coverage in response to the changes you
have planned for your business.

For example, if you're not currently offering delivery services but want to
start, you'll need commercial auto insurance to protect your business from
accident-related expenses. (Your personal auto insurance will likely not cover
this.)

Or, if you've been a one-person shop since you launched your business and plan
to hire employees, you'll probably need workers' compensation coverage. It's
required in nearly every state if you have employees.



HOW NEXT HELPS SMALL BUSINESSES WITH THEIR BUSINESS EXPANSIONS

At NEXT, we offer customized insurance packages for 1,000+ different types of
small businesses. Coverage options include general liability, workers'
compensation, professional liability, commercial auto, commercial property and
tools and equipment coverage.

Our mix and match policies allow you to select as much or as little coverage as
you need, so you're never over- or underinsured.

With our simple online application, you can see policy options, get a quote,
purchase coverage and get your certificate of insurance — all in less than 10
minutes.

Get started with your instant quote today.




By Kim Mercado
Kim Mercado is a content editor at NEXT's blog, where she writes and edits posts
for small business owners. She is an experienced marketing professional and
loves helping entrepreneurs solve their business challenges. You can find Kim
trying new recipes and cheering the 49ers.

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