How To Grow Your Business. Part 3
Do you want to grow your business? This second series of articles goes beyond the basic ‘sell more / charge more’ advice to explore your options for business growth. In my role as Editor for The Business Show and Business Startup, I have talked with literally thousands of business owners and entrepreneurs about what they really need to know, not what a business guru thinks they need to know. This series is the result. Today’s blog looks at whether adding a second location is your best option.
Adding A Second Location
If your business is location based – like a retail store – and it’s well established, then it’s possible that there isn’t much room for growth from that site. You could expand your product range, or invest in marketing, but another option is to repeat the success in another location.
Of course, the big benefit is that you will immediately reach a new set of potential customers with the ultimate goal of doubling your profit over time. And if that goes well, then you could be on your way to opening a chain of locations – and big money. By adding a second location, you’ll hope to be selling twice as much product, so you’ll need to order twice as much, so now’s the perfect time to renegotiate a better price from your supplier – good news for your existing site’s profit margin!
But you must be realistic about the costs involved both in the initial set-up of a second site and supporting it until it reaches break-even point. That could drain funds from your first location and the one thing you won’t want to do is jeopardise your existing business by overextending during an expansion phase.
Adding a location is an exciting prospect, but not one to leap into. You really need to dissect the books from your existing site to be certain that it can sustain both businesses in the short term. Even if you aren’t looking to secure investment to fund this growth, you should revisit your original business plan and revise it to reflect your latest plans. This will help to focus your thinking.
You could run each location as a separate business, but most likely, you’ll find that one will be a base of operations, with the other a satellite location. If that’s the case, then you need to plan how you intend to scale your administrative systems and management team to accommodate both sites.
Another consideration to factor in is the location itself. While you want the second site to be near enough to easily manage, while leveraging consumer goodwill in the area that you have built up with your first site, you need to make sure that the catchment areas don’t overlap, or your two locations run the risk of poaching each other’s trade.
But adding a location isn’t your only option for expanding your brand into another area. The next article looks at a lower risk alternative to adding a location: starting a franchise.
Next: Start A Franchise
If you find the series – or any of the articles in it – useful, please share them via LinkedIn, Facebook, Twitter, or your own blog. I’d really appreciate it, thanks. If you need professional copywriting for anything from your new web copy to marketing collateral and press releases, I’d love to hear from you. Get in touch today to find out how I could help your business.