It’s been some time since you opened your first location and business is good. You’ve established yourself and operations are smooth. It’s no way but up from here and growing and expanding seems like the route to go for and consider.
Opening a second location is much like opening a new business so most of the things you need to know and have are similar to when you opened initially. However, most of these things tend to get overlooked for the second location. Your first location being in good shape should not only be the only thing you consider. Fear not, we’ve compiled a list of questions a small business owner should ask themselves when they feel it’s time to open that second store:
Are the people you want to reach in the area?
With anything you do with your business, you always think about your demographic first. Looking for a second location shouldn’t be any different. What is the strength of your existing target market in the area you’re thinking of? Is there potential for a new target market? Market research is key. Know your prospects, and find out where they are.
Is there an unfulfilled demand for your product/service in the area?
In relation to this, the next thing to consider is if there’s an unfulfilled demand for your product or service in the location you’re looking at. If you’re thinking of opening a second location of your sushi restaurant in the downtown area of your city hoping to attract all the young professionals working there, it might not be the best decision if there are already ten sushi places in that area all fighting for the same demographic. Again, market research is key.
Do you have a reliable second person to manage the location?
Alternately, if you plan on managing the second location yourself, do you have a trustworthy person to man your first one? Before deciding to go on the decision of expanding, make sure that the location can operate well without you – and that starts with having someone on your team who you can trust with the responsibility of being “the second you.” If you already do, that’s awesome! If not, this might be the perfect time to hire a rock star manager. Check out our tips on hiring a super star staff here.
How are you funding your expansion?
As you very well know from opening your first location, costs are no joke. There’s rent, equipment, new employees, renovation, the list goes on. Instead of taking away from the cash flow of your first location, consider your new location as its own business venture. While bank loans would be the most conventional way to go, it’s also time consuming and it has a low approval rate. If you’re looking for something hassle-free, you might want to check out Ironwood Finance’s working capital deals. In three easy steps, you can have your funds in your bank account in as soon as 48 hours.