Join the Esme experts as we go through five sure signs that your business is ready to grow. We’ll also show how our business loans can help smooth the expansion process and ensure you have the capital required to effectively grow your business.
The first sign that it’s time to develop your business is that you have a regular and loyal core of customers who are consistently spending money on your service or products. For the most part, it demonstrates a demand for your business. And if it’s a particularly high demand, even better! It also indicates that customers enjoy your product or service, and suggests that you can gain an even greater response through expansion.
It’s always worth remembering that your customers can provide key insights into your business’s performance – and whether it’s the right time to grow. For instance, they might be telling you that they’re travelling large distances for your services, posting on social media about how much they love your offering, or leaving glowing reviews online.
At the same time, it’s equally important to be receptive towards negative feedback, and evaluate whether it warrants making changes to your business. For one, taking feedback on board will mean that – in many cases – you’ll be able to improve your service to meet the needs of a greater number of consumers. Bad reviews also leave a poor impression of your business to prospective customers, lessening your chances of attracting new clientele.
It’s always a good feeling when profits are high – whether it’s seeing a busy shop-floor or having your services be in high demand.
However, an increase in profit doesn’t necessarily mean that your business is ready to expand. It could be that you’ve been going through a seasonal spike, for instance, or simply that a change of trends has made your business particularly desirable for a period of time (without a guarantee of increased long-term demand).
If you’re weighing up whether or not your business is ready to expand, we advise placing more focus on long-term profits over short-term spikes. Steady profits over a number of years – say, two or three – are a much better indicator that your business is ready to grow than a dramatic increase over a few months.
On this topic, it’s key to have a comprehensive business plan to hand. It means that you can set targets and monitor your performance over time, seeing whether you’re exceeding expectations, or if performance needs to pick up in order for your goals to be met.
If expansion is on your radar, you need to ensure that your business has a steady and reliable cash flow, so that all costs are being covered and liabilities are being swiftly repaid.
Failing to do this means that you might be spending money without it coming in, potentially risking your business’ financial health.
As always, it’s essential to stay on top of your business’s spending over time. Head over to our blog to find out about how keep your business’ finances in order.
Expansion will inevitably pose challenges for your business, whether it’s a new product line that you need to become an expert in, a new account that requires hours of painstaking admin, or a new service to be learned and offered.
While you might be really keen to expand as soon as you can, it’s important to make sure you’re surrounded by people with a positive attitude and the capability to rise to the task at hand. You’ll need to depend on your employees to meet the new challenges arising, whilst ensuring that they’re not overstretched by an over-demanding environment. Balance this right, and you’ll create a workplace that’s more upbeat and more profitable – with research by The University of Warwick showing that happy staff are 12% more productive, while those who are stressed are 10% less.
Of course, there are many short term benefits to hiring smartly, too. Working with people you connect with on a personal and professional level creates a positive atmosphere for both employees and customers.
Industry growth often varies with the times, as new trends capture the UK’s imagination and buying habits change.
However, take care with this. Just like rising profits, you need to ensure that your growth is sustainable and in the long-term, rather than simply a short-term spike. After all, there’s no commercial sense in expanding your offering if there isn’t the demand to meet it.
Once you’re ready to expand, the next thing you’ll need is a large amount of cash in order to make the necessary changes – whether that’s hiring new staff, acquiring new stock, or upscaling your premises.
This is where a business loan (or – in more complex terms – an expansion capital loan), comes in. It provides a healthy and sizable injection of cash at the time when you need it most, allowing you to upscale your business without jeopardising your cashflow, with flexible payment plans to suit your business’s needs.;