McDonald’s started with one storefront. So did Woolworths. And CommBank too. But how does one turn into many? What goes into making a small business a bigger one? Which locations should be part of your expansion? Should that expansion be solely an online one? And is the growth sustainable?
Ensure growth meets demand
Before you expand your business, you need to understand whether the growth can be sustained over the long term. You might be considering growing your small business to medium-sized, or even considering a series of franchises, but you first must ask yourself: is there demand for it?
If there is, start to look into where your customer base is located. If you’re a CommBank customer, this information is available from Daily IQ. It can also allow you to factor into your budget the costs of renting a commercial or industrial property in your areas of note.
It’s also important to start looking at what your competitors are doing or have done. If they’ve gone through a similar expansion, you might do well to learn from their mistakes. If they’ve succeeded, cherry pick the best parts of their success for your own growth strategy.
Another consideration is that expansion might not mean more stores, but a digital growth. This could involve upgrading your website capabilities to handle more traffic, accept payments online or include more features.
Building your team
Human capital is the most important investment you can make when growing your business1. The faster you grow, the more staff you may need. Your business plan should factor in whether you have sufficient cash flow relative to the projected revenue increase. The cash flow you have may dictate how many people you can hire to be in-store or handle online requests, and how soon you can bring them onboard.
Once you’ve increased your team, you need to consider how to manage them by setting up a structure to ensure efficient communication between employees and yourself. Sometimes this requires tweaking or even building a whole new structure to look after your extra staff.
Remember, scaling your business also involves accepting that you don’t need to handle everything alone2. So, focus on hiring and training others you can trust to aid you in the day-to-day operations, whether that’s done in-store or online.
Maintaining processes and partnerships
Expansion can also impact your processes, operations, and supply partners. That’s why it’s definitely worth contacting everyone involved in your business – both internally and externally – to find out what your expansion will mean for them too.
One of the common mistakes people make when expanding their business is failing to remember what made their business successful in the first place3. You might be ready to grow, but if you’re a grocer for example, are the people supplying your fruit and vegetables able to meet your larger orders, the increased delivery frequency, and travel to your new location?
At the end of the day, if they can’t meet your demand, you’ll need to find new people to partner with. And will that affect the standard of your offering?
Keeping the culture alive
In a recent study, it was found that “organisational culture can significantly influence the performance and effectiveness of a company; the morale and productivity of its employees; and its ability to attract, motivate and retain talented people”4.
Maintaining culture is critical to ensuring the tone of voice and core beliefs of your business stay true throughout your expansion and into the future. Sometimes that might require you or someone from your core team to be available for onboarding. This will allow new staff to have face-to-face time either in-person or via video call with a founding member of the original company. Someone who can relay and uphold the culture.
Something that will help maintain culture is formalising it. Create a printed or digital welcome book for employees and stick to a structured training program to maintain consistency.
Understanding what it takes to grow, sustainably
Obviously, growing isn’t something that can be rushed. There’s a lot of planning and strategising required before you put your expansion into action. But by taking the time to properly plan, you’re giving your business the best chance of growing at a sustainable rate.
Get started now by finding out where your customers are located. Visit Daily IQ, a free insights tool from CommBank.