14 Mar Things to consider before you open a second business location
Is your business thriving? Is a second location on your mind? It is very important to consider all the factors carefully before you open up. Let’s take a look at some question you should ask yourself.
How strong are your sales?
- Are your sales growing consistently for an extended period
Can you afford a second location?
- Make sure you are not stretching yourself too thin financially
Do you have time for a second location?
- Will you be able to stretch yourself between two locations
- It is challenging enough to manage one location with customers, employees, inventory, and payroll.
Can you tap into a market outside of your current location?
- There need to be a demand for your product or services at your second location. Are your customers traveling far to your current location?
Will the second location increase revenue?
- Make sure that opening a second location would in no way cannibalize the first.
- It can open up a whole new customer base that you never had before.
Where will the cost come from?
Will the revenue alone cover the second location’s expenses? If not, you must get outside funding. You might consider whether you have the capital you need or you need to get funding for the second location. It may take some time for your new location to have a positive cash flow. It is very important that your first location stays in good financial health during this time. You need to look at all aspects of the business and make sure you are not depleting your overall resources, too much which can leave you in a hole. Check out these articles from industry leaders like inc.com, Quickbooks, and Entrepreneur.com.