Running a successful business gives a charge all its own: it’s an almost electric feeling. Failure to expand that business by replicating it at an additional location? Not a good feeling at all. Starting up one winning location is hard work, but once you have proof of concept, everyone starts to see dollar signs around the word “franchising”. Not accurately assessing what’s at stake is the downfall of many small business owners. Opening more locations can mean more cash, but you need to examine the idea carefully to avoid disaster. However, if you don’t take risks, you also don’t get ahead in business. That leaves you with a serious question: How do you know when it’s time to grow by expanding locations? Here’s a guide to help get you started.
1. Why Do You Want to Grow?
If you run a business, you’ve already got drive and guts. You’ve achieved a goal; now it’s time for another shot at the brass ring. Keep in mind though that this drive can get you into trouble if you expand your business before considering alternatives. More does not always equal better. Opening a second location means that you are spreading your resources thin with no promise of return. Before you take the leap, be sure that you have explored all of your options for satisfying that drive to achieve more. There may be another goal out there you have overlooked that will fulfil that need and prevent you from risking it all on one big idea.
2. Are You Underestimating Your Personal Role in Your Success?
When the buck stops with you, and you believe wholeheartedly in your brand, it is tough to see how much influence you have personally on your business’ success. When the time comes to duplicate your formula with another location, your role is going to change, and you need to be prepared for that. If location one has been the recipient of a lot of your personal care and attention, dividing your efforts between two locations could cause both to perform poorly. When expanding, you need to take a step back and ask if you have the right people to manage some of the tasks and responsibilities you’ve typically controlled, and if you think you can pass off what made you so successful to someone else.
3. How Confident Are You in Your First Business?
Too often, your personal time, effort, and hard work include all the little details and added personal touches you contribute as an owner that your employees may just not know how to duplicate. If you are considering opening a second location, you need to pause and consider your existing operating processes: are they robust enough to function without you? There is a simple test you can conduct to determine this. If you were to go on vacation out of the country with little to no communication with your employees, would everything fall apart at your existing location? If you know deep down that your entire operation would come down like a house of cards in a whirlwind after a week or less, you need to establish more autonomy before you even consider the idea of adding a second location. Your day-to-day procedures and protocols should be running like a Swiss watch, and employees should know exactly what to do to keep everything running well without your immediate supervision. If that isn’t how your business works right now, you aren’t ready for that second location.
4. Do You Have The Right People in Place to Make This Significant Change?
You may be a fantastic one-location manager, but that doesn’t guarantee that you will naturally be an expert at running multiple locations. To expand into a second location, you won’t just be hiring managers to help you run multiple location operations, but also an entirely new staff. Everyone from the front-end personnel to the cleaning crew needs to be vetted, interviewed, and on-boarded to run that second business. You will have to be prepared to let go of the reins at the right time after you have trained your staff to run your second location according to the system you’ve developed at location one. Going from hands-on to hands-off can be difficult, and you have to consider even if you have the skillset and a willing spirit, is that the role you want?
5. Are You Ready to Quit Thinking and Start Doing?
If you have done your due diligence, balanced your books, and you still feel you need to open that second location, then it is time to put up or shut up. You can prepare until the end of the world, but if you take too long and overthink to the point of paralysis, you may miss your window of opportunity. If you can handle a different role, you know you have the right people, and the numbers make sense, roll your sleeves up and keep working on building that next dream.