Your business is flourishing. There are customers’ demand that are not meant. You figure out it’s time for your business to expand. Now the question is: “Is it really the perfect time to expand?”
Expanding your business only seems like the natural step forward once you see your business turn sizable profit. Once you’ve conquered your local market, what’s there left to do other than move forward and introduce your efforts to other markets and new customer pools? Of course, it’s not as easy as snapping your fingers and more often than that, business expansion will be tiresome at best, given all the things that need to be considered.
In other words, there are great reasons for both expanding and staying local, but it depends on each business owner individually and their personal endeavor which move is best. Let’s take a look at the various differences between staying local and expanding, and what businesses can hope to gain from each side.
Top reasons not to expand
- Expansion involves additional working capital and more costs to maintain. Taking on more and more work to generate more income places additional pressure on your finances and staff.
- You already have a favorable grip on your captive market and your business has already established a foothold in the industry. You can just focus on improving your products and services.
- You have way less competitors to worry about than if you would expand to multiple locations.
- Choosing not to expand also provides more security as there are far less problems to worry about and it is easier to manage your operation and keep it profitable.
- Although you might miss out on the excitement of a challenge, choosing not to expand can give you peace of mind, which is far more important to some.
Top reasons to expand
- You get infinitely more brand exposure when you expand, depending on how many more locations you open or how far you extend your serviceable territory.
- Expanding is an opportunity to learn more about the industry in which you operate and about business in general as you meet more experienced people
- Depending on whether you expand nationally or internationally, you can have a large or even huge increase in customers
- Expansion might provide great traveling opportunities so in case you always wanted to visit a place locally or another country you never got to, you have more compelling reasons to do it because of business meetings.
Before you expand your business, make sure that you have a plan on how to do it especially in hiring the right talent, managing your costs and marketing your products and services. If you expand too quickly, you risk your business becoming unsustainable as growth can definitely put pressure on your finances and staffs.