You’ve launched your retail business, worked hard to reach the breakeven point and found measurable success. Congratulations! Crossing that hurdle is the biggest challenge for any business owner, but how do you know when it’s time to expand? After reaching that success, there are indicators you should move on to the next growth phase. Here are some signs your business is heading in the right direction for expansion.
1. You are struggling to meet demand.
This is a good challenge to have. If your product is high in demand and you struggle to supply for your customers, then this could be a sign you should look at maximizing your operations. Because almost every retail business is cyclical, you want to be certain this is an ongoing need and not a pattern based on seasons or events. Check POS systems to ensure monthly sales have been consecutive or increasing each month. If those sales are steadily increasing, it might be time to take a look at how to expand or improve upon your operational efficiencies. The same goes for your team. If they cannot keep up with customer / sales volumes, expansion for you may mean hiring more employees.
2. You are hitting goals.
Before you opened your doors for business, you more than likely laid out a roadmap for success for yourself and put processes in place. Are you hitting those milestones? If so, it might be time to set your sights on even bigger and more challenging goals aimed towards expansion. Reviewing your starting point to see how far your business has evolved is great to freshen perspective on future planning. It also ensures you are setting appropriate goals to make it through market challenges like change in demand, technology, and keeping up with fluctuation in trends. To keep reaching for those goals you need to be keen on how to direct your business in the right direction.
3. Customers are reaching out to you.
Your customer base indicates where your business is heading. Having a loyal base will give insight on what future growth potential looks like. Pay attention to customer needs and supply products they can come back for throughout the year. If you’ve got sales consistency and your customers express interest in a larger variety of products, consider what kind of expansion is appropriate for your business. While brand loyalty drives sales growth, it’s also a great indicator that you may be positioned to expand to meet the product demand in your local market.
4. Your team is supportive.
Employee loyalty is a competitive advantage you might have as a small business. Before taking on an expansion initiative of any kind, you need a supportive team who will stick with you in the trenches. If you take a look around and realize you’ve got that in place as well, then you’ll be set for success. Feeling a little shaky about taking the next step with your team? Here are some ways to build employee loyalty. Having a team that will make you feel confident and comfortable in taking on more work during this leap will be beneficial in making the process a little less stressful.
5. Space and old equipment is an issue
Are you busting at the seams in your retail space? If you struggle with places to put extra inventory or you’ve simply outgrown the space, it might be time to consider options for an expansion or new location. Another operational aspect to consider is how well your current equipment facilitates increasing growth. Does it keep up with the sales volume? Does it slow down your processes? If you are using dated or lower quality equipment and it’s hindering output, an expansion for you may mean investing in new.
At Reliant Funding we know small businesses need working capital to grow. As your business focus changes beyond the startup phase, we are here to help along the way. We speak to small business owners every day and provide them with fast and flexible funding when expansion opportunities come knocking. Questions? We can help.