How to Know When Your Startup Needs to Expand

Emma Sturgis

December 22, 2014

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Many entrepreneurs who start a new business have a grand vision in mind of growing their start-up into a large, profitable success. However, successful entrepreneurs often are faced with the challenges associated with balancing the confidence to move forward when opportunity presents itself against monitoring the risks and proceeding with caution. As an entrepreneur managing a budding start-up, you may be wondering if the time has come for you to expand. There are a few indicators of having some room to grow that can tell you the time has come to seize opportunity and move forward with your business.

Demand For Products or Services is Strong

If your growth is being generated by your considerable investment into marketing and advertising rather than by a loyal customer base and a general buzz about your offerings, you may not be ready to expand. While all companies will need to invest in marketing and advertising, your company may not be ready to expand if at least some of your business is not being generated outside of these efforts.

You Have Realistic Expectations

Not every opportunity to grow is feasibly realistic or beneficial. It is important to analyze your company's finances, goals and resources to determine if the opportunity in front of you is a good one to pursue. Be realistic in your expectations of how quickly your company can reasonably grow and what kind of growth rate your infrastructure and manpower can support.

Trust In the Efforts of Your Team

Your efforts to grow and expand will be impeded and even thwarted if you do not have a skilled, knowledgeable and hardworking team working for you. While this includes your own employees, it also may include contractors and vendors that you have established relationships with. Without the support of a great team, you will struggle to expand as intended. The same goes for any service you outsource to—if you are dissatisfied with any of your service providers, now is the time to change that. A logistics expert from Meyers Transport Ltd says small business owners often find themselves held back from expansion by unsatisfactory fulfillment and transport services. Don’t fall into the trap of sticking with what you know, in terms of service providers, when you could move forward with a better provider.

Support in Your Personal Life

You may already spend long hours away from home working to get your start-up off the ground, and the time and energy demands to promote growth can be even more significant. If your family is already complaining about your work schedule; or if you have significant personal demands, such as caring for a sick relative, now may not be the ideal time to pursue growth.

While there are many factors to review and data to analyze before you make a final decision about the direction to steer your company, these factors should not be overlooked. It can be exciting and rewarding to be presented with the opportunity to take your start-up to the next level, but you do want to weigh the pros, cons, risks and rewards to make a great decision.