The opportunity for a business owner to expand their business is both exciting and potentially risky. When you are considering expansion, it generally means potential growth of the business which is a positive development. However, jumping into expansion without considering several key questions may place your overall business at Risk.
The initial question you need to answer is why am I contemplating expansion? Is it to immediately gain new business or to be in a position to acquire new opportunities in the future? The Second question relates to servicing immediate new business: is the new business short or long-term? If short term what will it cost to wind down the expansion plans? The third question is, if I am looking for new business in the future what is the level of investment necessary and how long can I maintain and carry the additional investment, without adversely affecting my existing business.
The decision to make an investment in expansion will put pressure on your finances, human capital and other resources in your business. Make sure your current business is strong enough to carry and sustain this investment, so that the expansion doesn’t jeopardize your overall business.
Courtesy of Michael Janicki, The Jan Consulting Group, East Stroudsburg, PA,
Edited by Achim Neumann