Your business is going great, and you’re starting to think about ways to grow. Expanding a small business requires careful planning, strategic thinking, and a proactive approach. While the journey can be challenging, implementing the right strategies can lead to significant growth and success. Expanding your small business doesn’t need a huge investment and can be achieved with smaller-scale initiatives.
But, before you dive in, how do you know when it’s time to consider expansion? While these tips can be used almost any time for your business, here are some signs your business is ready to expand:
- You have a lot of customers.
- Your customers demand more from your business.
- You have a steady stream of revenue coming in.
Whether there’s an increased demand for your services, or you’re just looking to expand revenue for your business, this article explores 5 strategies to grow your small business.
Diversify your product or service offerings
One of the most common and successful methods of business expansion is diversification. Offering new products or services can help you tap into new markets, attract a larger customer base and increase revenue streams.
Diversifying your business should be rooted in market research: What is a product or service your current customers would like? What is a need that’s not being fulfilled by your company? Identify solutions your business can offer your customers. Look for opportunities to create complementary products or services that align with your current business.
For example, if you own a bakery, you could consider adding gluten-free options to your menu and cater to customers with dietary restrictions or you could expand your offerings to include a coffee bar for customers to enjoy their baked goods. Expanding your range of products provides more value to your existing customers but also helps attract new ones.
Invest in marketing
The biggest way to grow your small business is to increase your customer base and the best way to do that is to invest in marketing. Marketing helps increase your visibility and reach more customers. Whether you’re investing in advertising or updating your company’s social media profiles, making marketing a priority for your business will help attract new customers. Here are some simple marketing ideas to get started:
- Advertise locally
- Engage with your audience on social media
- Invest in digital advertising
- Email your customers about promotions or new products
For more marketing tips, our guide offers a comprehensive look at marketing strategies for a small business.
Another way to increase the word-of-mouth for your business is through your customers. Happy customers often provide free advertising for your business by happily recommending a great product or experience. To encourage your satisfied customers to help spread the word, consider offering a referral program for your business.
Explore new markets
Similar to diversifying your products, exploring new markets is an opportunity to tap into new customers. Are there products or services related to your business that could bring in new customers and become profitable? Conduct market research to understand what opportunities you have and gain insight into untapped demographics, buying behavior, and preferences for potential customers. This research can guide you to new areas of growth you may not have previously known about. Learn how to conduct market research for your business and start exploring what markets you can grow into.
Form strategic partnerships
There’s an expression – “a rising tide lifts all boats” and that can be applied to business too. Partnering with other small businesses in your market who offer complementary products or services can boost both businesses. You can cross-promote each other by offering exclusive discounts for your customers or share resources.
Using the same bakery example again, you could partner with a local coffee roastery to serve in your bakery and could even expand to selling your baked goods in their store. This partnership brings fans of both businesses to each other and through cross-promotion, increases the likelihood of new customers finding your business.
Invest in employee development and infrastructure
Investing in your employees and business infrastructure ensures your business is set up for success in the short and long term. Provide training and development opportunities to help your team acquire new skills and stay up to date with industry trends. A well-trained and motivated team can contribute significantly to the success of your expansion efforts.
Additionally, invest in the necessary infrastructure, technology, and systems to support your growth. This might involve upgrading your inventory management software, expanding your production capacity, or improving your customer relationship management system. Even automating parts of your business – whether that’s using accounting software or outsourcing payroll – can increase efficiencies and free up time for you and your staff to focus on other initiatives to expand your business. Streamlining your business operations can lead to increased productivity and reduced costs.
Growing your small business
One important aspect to consider when you start planning your business expansion is the source of funding. While some of these tips don’t require a large investment, when your business grows you may need more capital to fulfill purchase orders and keep up with demand. Explore your funding options to mitigate growing pains.
About the Author
Kelly Hillock is the content marketing manager for SmallBusinessLoans, where she writes and edits articles for small business owners. Kelly has over eight years’ experience in copywriting across a variety of industries, focusing on entrepreneurship and finance. She has a Bachelor of Arts in journalism from San Diego State University.