If your business performs well, your customer base will inevitably grow. You might even consider opening an additional location.
If this is where you find yourself, the proper strategy is crucial to avoid wasting your resources on a poorly executed — or failed — expansion.
Following are three key considerations when you’re thinking about expanding your business.
Financial Stability
Consistent revenue
All businesses have ups and downs. But being able to consistently count on a certain level of revenue in your established location is crucial. You don’t want the inevitable low months at the new location to impact your business.
Sufficient cash reserves
Having enough money set aside to cover unexpected expenses and short-term issues is also important. Nine months or more of cash reserves ensures a healthy cushion for your current operations while funding or financing the expansion.
A complete budget
And, of course, having a budget completed is critical. Make sure you have a complete picture of the expected financial performance of your new location as well as that of your established location.
Market Research
Doing your homework will help you determine whether there is enough demand to make the expansion worth it.
Collect and analyze data about the area you hope to expand into. Develop a clear picture of the demographics and the competitive landscape of the market.
Operational Capacity
and Efficiency
Staffing
Your energy will be focused on setting the new location up for success. Consider whether the current staff can run the practice and generate similar revenue with minimal supervision.
If not, additional staff need to be hired — ensure your budget and timeline reflect that.
Processes
On a related note, ensure there are consistent, duplicable processes and strong systems in place.
For one thing, this will help you maintain your brand strength and exceptional patient care in the new location.
Secondly, reviewing your processes (and documenting them, if you haven’t) gives you a chance to discover ways they could be fine-tuned.
The smoother your operations, the easier it will be for the staff at your established location to run the practice without needing to add staff.
Our business-development team can help with everything from expansion to exit strategies. Check out this case study to see them in action!