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5 big signs you’re ready to expand your business

4 min read

getting a small business loan
Small businesses start small. Maybe it’s just you, your laptop, and a few hours on the weekend. But if your business goes well, you may outgrow your original plan. More customers often bring more work than you or a small team can handle.

On the other hand, expansion can feel risky. Hiring people, acquiring more space, or buying new equipment can cost serious money. Sometimes it’s difficult to know if the risk is worth it.

So let’s take a look at some key questions. If you answer “yes” to most of the questions below, it might be a good time to take the plunge.

1. Do you have a strong customer base?

And do your customers want more from you? Having plenty of repeat customers is an important first step to growing your business. Having customers who ask you to expand your business hours, or who drive long distances to seek you out, may be even better.

There are lots of ways to gather information about your customers that can help you learn what they want. In a retail store, you can simply ask them in person: Where are you from? Is there anything else we can offer? Small companies that offer business or online services can also use customer surveys.

As you begin to count and track customers, beware of outliers in your data. Fads wither. Seasonal surges may ebb. If your demand is temporary, don’t over-commit.

What could you do with flexible business funding?

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What could you do with flexible business funding?

Get started
Desktop version or call 800.556.9145

2. Do you have too much money?

This doesn’t sound like a problem. Actually, it can be. Your business profits may flow into your personal bank account all you want. But as a general rule, your business accounts should have enough cash on hand to cover about 3 to 6 months’ worth of operating expenses.

If you have more money than that lying around, you may be starving your business of the capital it needs to grow.1 Consider investing in ads, better equipment, more real estate, or talented new hires.

3. Do you have the right systems in place?

If you’ve been running a small business long enough to begin thinking about expansion, you know how hard it can be to create the right systems and processes. Sometimes these logistics take up your whole day.

To expand, you’ll probably need accounting and payroll software. Other software packages track productivity and manage projects; still others manage the flow of digital content from conception to final delivery.

Whether it’s a computer, an oven, or a lathe, you and your team will need training on how to use it. As revenue grows, what’s your process for handling cash?

Your systems will evolve as your business grows. Get things in order now so your systems grow with you.

4. Do you need something you don’t have?

Often when we start a small business, we don’t know everything we’ll need. We may know the product inside and out, but our technology or accounting systems could be improved. Maybe at first we can only afford a small space or used equipment.

If we’re lucky, our business becomes so popular that it can’t grow any more until we remove these early obstacles. Hiring top talent, or someone whose expertise complements our weakness, is often a good place to start. New machines will be more efficient and cost less in the long run.

If you keep saying to yourself, “I could do a lot better if I only had … ” you’re probably ready to go and get it.

5. Is your industry growing?

A rising tide lifts all boats. Or most of them, anyway. Are you noticing a lot of new companies selling the same things as you? Are they busy? Are you getting emails advertising new associations and conferences serving your industry?

You may be in a good position to expand with the rest of them, especially if you tailor your offerings to a part of your growing market that no one else sees.

Choosing the resources you need

When you’re contemplating the next step, look at the resources you have on hand – or close by. Find ways to reinvest some of your cash – if possible. Look for ways to move expenses by cutting unnecessary costs, and free up money to put toward your company’s bright future. Also, consider your funding options – like a long-term loan for big investments, for example, or short-term funding, like QuickBooks Capital, for quicker-turnaround projects.

We want to hear from you! What do you think?