When To Expand A Home Business

Having set-up and established a small business, for many entrepreneurs the next step is to start planning for growth.

Guest Blogger, Aimee Claire believes that others may find that growth comes naturally and organically as their business becomes established and starts to gain a reputation and an expanding customer base.

Either way, it is important for the home business entrepreneur to be prepared for the consequences of expansion. In this way growth can be a profitable benefit of the hard work put into the business, rather than simply an extra set of burdens.

What To Do When Your Home Business Expands

How do you even know when to expand a home business? One of the key strategic decisions to make, in terms of expansion, is timing. There are no hard and fast rules for this and in each case the factors involved will be different.

However, two of the main components to consider in the decision are whether the market for the product or service will support the larger business and whether the resources of the business are sufficient to cope with the increased demand.

Analysis of the company’s financial strengths and weaknesses is crucial; a small business with access to sound data and advice concerning trends and potential markets is likely to have an advantage.

How To Successfully Expand A Business

Once the decision has been made to go for expansion, it can be achievhow to expand your home based businessed in several different ways.  The simplest type of expansion is achieved by increasing the customer base for existing products or services, so that more orders are received.

Other options include adding extra products or services or perhaps taking over a competitor in order to gain their assets and customer base.

Depending on the nature of the expansion, a home business may actually benefit by moving to larger premises. A small increase in the volume of orders may be within the capacity of a home office to deal with.

However, if the range of products and services expands and production or sales require additional space, it may be beneficial to base the business in commercial premises.

For example, a move to a town centre location, perhaps with a shop-front, is likely to attract more customers and make services more accessible.

On the other hand, an additional location in another town may be beneficial if the market expansion involves attracting customers over a wider geographical area.

Advantages Of Outsourcing And ERP

In a business that is expanding rapidly, solutions to coping with the growing volume of administrative tasks may include outsourcing and the implementation of an ERP (Enterprise Resource Planning) system. Outsourcing basic administrative tasks can be a cost-effective means of accessing extra resources while keeping personnel costs low and making management’s time more effective.

Once the desired level of expansion has been achieved and it has become necessary to employ a number of people working on common data, it may be time to consider installing an ERP system.

ERP ensures that all data, right across the various departments of a company, is consistently up-to-date and can be used simultaneously in various locations. An enterprise with a growing number of workers, either in-house or outsourced, or an enterprise operating out of several locations, might therefore benefit from the streamlined information flow that ERP brings.

Aimee Claire is a well educated, enthusiastic freelance writer with a special interest in new businesses.