All SMEs look to expand at some point. Successful expansion means greater revenue, more staff, a greater outreach, and more brand recognition. While there are many potential benefits of a successful expansion, expanding in the right way can be a challenge, especially if it is the businesses’ first time attempting large-scale growth. As such, it’s not uncommon for businesses to make mistakes when expanding, which end up proving costly. At Tower Leasing, we’ve seen many expansion attempts, and want to share our wisdom on what not to do with you. In this article we look at business expansion mistakes you should avoid.
1. Failing to understand what your customers want
Diversification and expansion into new business areas can prove to be a real opportunity, especially if you link them to your original services. It can mean that customers use your business for multiple services, encouraging repeat custom, while also increasing your brand name in different sectors. However, there’s no point investing in alternative sectors if that’s not what your clients need or want. Before any expansion, it’s vital that you understand your customers and what they expect from you.
2. Not using a specific action plan
Even if you have a great idea for business expansion, it’s unlikely to be successful if you don’t have a credible action plan for how to achieve your end goal. All plans must be specific, actionable and broken down into easy to follow steps, to ensure that nothing has been missed. Without a proper plan, you’re unlikely to take a direct course to your end goal, missing out on a great opportunity.
3. Forgetting the need to finance the expansion
Business expansion can be costly but will prove a great return on investment if done properly. Before expansion, you must fully consider your cash flow reserves, and establish if you need to find additional money from somewhere else. There are many options of funding available such as business loans or alternative finance, so even if your cash flow is lacking, you can still look to expand and can make it a success with the right finance deal.
Business expansion mistakes – where to find out more
If you want to expand your business but need help with finance, please get in touch, we can help.
To find out more about the business expansion finance we can help with, please visit our Finance for my Business page.