Expansion is an aspirational goal for all businesses and it might seem like the first year of business is too early to start expansion plans. But, expansion requires more capital, more manpower, more stock, a bigger corner of the market, etc. and a plan that makes every tactic something that supports ultimate expansion as you continue to grow. These are all elements we think about when we measure success, and, if you’re someone who has a startup or relatively small business of your own, you might think these elements are a long way away yet.
But maybe they’re not so far in the distant future after all…
Because, when it comes to establishing a sustainable business, expansion should be on the planning horizon from day one! Even when you’re just starting out, and you’ve got a lot of work to do to get to a place where you’re ready to take bigger slices of the pie, every single day ahead should focus on growth and lead to eventual expansion.
There are a number of ways a small business can expand, especially when the world is your oyster, and you’re operating within a very profitable niche market. But which options are possible and should form part of your long-term plans in your first year of business? Which options have the greatest impact on your current operations and move you toward ultimate success?
The number of options is staggering and can be quite confusing, can’t they? Which is why it’s important to go through this planning process in a little more detail, and we’ve done so below.
Just take a look at your website analytics, if you want to get started on studying where to go next!
First, Start Your Goals Off Small
If you’re a startup in your first year of business, you need to aim high but keep your expectations realistic – you have limited resources of time, money, and attention, so you need to husband these and plan for goals that you can achieve given these limitations. You’ll have plenty to aspire to and work towards, but you’ll be doing so in stages, step-by-step; never rushing headfirst into something too soon. You won’t exist in a bubble, destined to pop with nothing but a fall beneath you; never knowingly let yourself put your company in that kind of position!
So, start off small. Make sure you’ve got plenty of ideas to make plans and make sure you’re never too rigid in how those plans go. In the modern-day and age, you need to be flexible, as every market out there is changing all the time. Charles Geschke, the co-founder of Adobe, tells the story of building a business plan and rigidly ignoring opportunities that didn’t fit that plan until their mentor told them they were crazy to stick so rigidly to their plan. We all know how their willingness to bend turned out.
Assets are finite and, more often than not, that means you have to plan for contingencies with resources held for such downturns. How would you work against such downturns? How would you even begin to deal with such a risk on the horizon, considering the fragile state of your first year of business?
The take-home message is that you need goals that are obtainable and lead on to bigger and better things in a carefully thought-out plan . Because such planning shows you’ve prepared, and it shows that you’ve got some great ideas rolling around your head, which attracts investors and offers a roadmap to success. You’re a startup, and you’ve got a long way to go!
Bringing in More Employees
A new employee means a lot of things for a new business. If you have the chance to take on a talented and skilled worker and set them down in the office to do their best work for you, you’re on the road to success. You’ve got another seat at the table filled, and that means you’ve got more power behind you – you’re clearly becoming more and more legitimate through your new employee’s talents!
But when is the right time to bring a new employee into the business? How do you balance the benefit of their talents with the costs you incur, especially in the first year of business. Well, when you’re struggling to take things on alone, or you know the team you already manage is missing one more crucial member and, because you lack that employee, your growth suffers. If you need skills you don’t have, such as social media management, or bookkeeping and account balancing, and no one in the team has the time to learn how to take these tasks on themselves, you know there’s room in the pot for one more. Your business is clearly crying out for more workers at the helm, and you’re never going to feel more successful than when you’re able to answer that call.
Moving into a New Office
A new office is one of the most cost-effective expansions possible during the first year of business, considering all the new benefits afforded by new space. An increased amount of space, especially in a sought-after location, means you can employ more manpower, have direct access to top paying customers, as well more chances for collaboration with other businesses, and some prime advertising space for signage promoting your business. It’s very much a snowball effect, and it’s one that you’ll find very useful in the years to come!
But what are the main factors to consider when selecting a startup office space? After all, you don’t want to get such a move wrong, and rush into a situation your business isn’t prepared to handle. You could lose a lot of money here, and mostly for nothing; the real estate world is very much a cutthroat one on its own, never mind what is said about the commercial sector. You have a lot of searching ahead of you to find the right space.
Among other challenges, you need a location that’s both operable and convenient, and that might mean a long commute for you and your employees if you’re not already close to the optimal location. You need a space in the right price range, and that means working out a budget, and negotiating until you’re down to the right price – how are your powers of persuasion?
Moving into a new office is tangible evidence of your dreams. It’s a very physical, tangible mark of the success you and your startup found together – if you take on more commercial real estate, and have the bodies and the ideas to fill it without difficulties, you show the year ahead holds the promise of bigger and better things.
Securing More Venture Capital
Your business needs capital to function; to pay for daily expenses and support future growth. Very few business leaders out there today got started on their own; working their way up from nothing. They all had support from investors who received stock in the company because investors believed in the idea and saw the opportunity to increase their own wealth.
Not only do investors supply needed financial resources, but they also provide invaluable management advice. So, it’s worth spending some of your limited time during your first year of business networking. You must get out there and prove to the people holding the capital that you are the business they need to add diversity to their portfolio.
Once you have more venture capital behind you, you’re ready for your next business expansion to increase the output and productivity of the operation. Some more capital leads to more and more growth within your company, so it’s definitely not an idea to sneeze at!
But how do you prove yourself to the people controlling the money? It was hard enough finding the first person to believe in your idea, wasn’t it? And now you’ve got to go through that process all over again? Well, don’t worry too much, because you at least know what to expect now – and that alone makes you an expert on impressing an investor.
Think about what worked last time, and then think about how you can improve your plan and make your presentation come off a bit smoother. You have the chance to make it big here, as long as you put in the right time and effort to carry yourself on!
Boosting Your Customer Base
Last, but by no means least, is the obvious tool of expansion; boost your customer base. Plan for better marketing tactics; reaching more people and showing them your products, and then bringing them back for more purchases because you showed them how your products solve their problems.
If you have the right customer base already, work toward market expansion to reach more of them. Or, maybe you develop more products that solve other problems experienced by that base that already knows and likes your product.
So, could your startup think about expanding right now? You’re in your first year of business, but could you take things one step further? Of course, you could, that’s what this first year is all about! So let’s make sure you’re taking on the challenge, and doing so in a responsible way that’ll actually garner you some results.
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