Methods Of Expanding a Business  

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Whichever type of expansion you are considering, there are a variety of methods to push and achieve that expansion. These are some of them.

Organic

Although this is typically the slowest way to expand, it can also be the cheapest and least risky. You can grow with organic content and traffic. You can use organic profits to pay for all types of expansion, including setting up new production and warehouse facilities or retail stores.

Typically the organic expansion is the one that any good startup accelerator would recommend as it is the hardest one to achieve. Certainly it can provide a nice competitive advantage over other competitors.

Paid

Laying out capital or leveraging exterior financing can be a faster way to expand your business. This can come from debt or equity, or both. Just make sure that the numbers really work.

Some of the most obvious examples of this are just spending a ton on out marketing the competition. Or subsidizing your offers to buy up market share and starve out the competition. Like Uber.

Acquisition

In the startup arena, one of the most popular expansion strategies is through mergers and acquisitions. Just buying the expansion.

This can be acquiring talent by buying companies, buying competitors in other geographic regions, acquiring for data and users or for technology and infrastructure.

Partnerships

Partnerships can be a fast way to expand and scale business without taking on too much expense or risk yourself. This can include teaming up with distribution partners and bundling with vendors, as well as through licensing your product and franchising your brand.

How To Plan Your Business Expansion

These are the steps to take in planning any business expansion.

Analysis

Start by getting clarity on what you want to do, and what’s available.

Why are you expanding? What is the strategy behind it? How will it set you up for the next phase or evolution of your business after this?

What markets are open and are growing fastest? Where is it important for you to grow versus where it may be most efficient and profitable to grow. Where can you get ahead of the competition without burning out of resources?

Talk to your potential customers there. Get intimate clarity on their specific problem and need. How might the service, features and desired UX be different?

Talk to other entrepreneurs, investors and experts in these fields and areas. Find out what the challenges are that you may not be seeing. How have others succeeded or failed at this?

Drafting Your Business Expansion Plan

You need a real plan. Just like when you started your business. At least a pitch deck that lays it out cohesively for you, your team, and shareholders.

What does it look like when this plan has been done right? What is the outcome, vision and goals? What are the musts for it to be worth it?

What are the working parts that need to be put in place? How will this part of your business be structured and organized for operations?

What Do You Need To Make It Happen?

List out all of the things you will need to execute on this.

What assets, equipment and technology will you need? What needs to be found, built or invested in for this expansion to function?

This may include more marketing, content and fundraising campaign materials in addition to hard assets. These may be the first tasks on your list.

People is a big part of this. How many additional people will you need to hire to achieve this scale? What specific skill sets do you need to hire? You may need to hire salespeople with key relationships and add new languages to your team.

You may also need new types of investors and business advisors to maximize your chances of success.

Then there is the funding. To expand you may need to invest in more infrastructure, hiring, marketing and more to go big and fast. Who are the best investors for this next stage of your business? Where are they located? What is important to them when it comes to evaluating investment opportunities? Who do you need to get out and network and build relationships with to make this happen? What is the best type of raise for this? Is it debt, equity, convertible notes, or something else?

Next, take this plan to your advisors and get their feedback on it. Where are the holes, overlooked challenges and missed opportunities for doing it better?

Once you’ve recalibrated and have begun putting these things into play, start testing. It’s smart to test the demand and fit and scale for real traction and dollars before going all in on it. Iterate and then scale it.

Hopefully you can then replicate this template for further business expansion efforts too.


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