6 Things To Consider When Expanding Your Business

Last Updated: 

December 8, 2023

If you run a business that has become successful, congratulations. You have made it past the rooky stages - the mistakes, the sleepless nights, the losses. A study in 2019 revealed that 60% of businesses go bust in their first three years. That puts your success into great perspective; you have beaten the odds, and made something great. It’s not all smooth sailing from here, but you can be proud of yourself that the company you built has come this far.

The journey from ‘small business’ to ‘large corporation’ is a gradual one - if it ever happens at all. Many small businesses choose to stay that way, remaining close-knit and focusing on the contained success they achieve. That is an admirable decision to make. However, if you do wish to expand your business, there are things to consider before you take the plunge. The worst thing you could do as a business owner is jeopardise your fortunate position by going into an expansion project entirely unprepared for the change.

Key Takeaways on What to Consider When Expanding Your Business:

  1. Supply Chain Management: Ensure your supply chain can handle increased demand. This may involve changing or ending relationships with smaller suppliers and planning for extra ordering and stock to maintain reliability.
  2. Budget for Potential Errors: Expansion is a financial risk, similar to starting a business. Prepare for potential financial losses and ensure there's room in your budget for unexpected dips during the expansion process.
  3. Maintain Brand Integrity: Be cautious about losing the essence of your brand, especially if it's built on local, personal goods and services. Expansion should be carefully planned to avoid alienating your existing customer base.
  4. Health and Safety Considerations: Expansion brings additional health and safety responsibilities. Be prepared for extra training costs, safety equipment, and compliance with regulations, especially in larger or more complex facilities.
  5. Managing a Larger Team: Expansion means delegating more responsibilities and adjusting to a less hands-on role. Budget for fair wages, holidays, and benefits for your growing team.
  6. International Business Law: If expanding internationally, be aware of the legal, cultural, and economic differences in new markets. Seek legal advice to navigate these complexities effectively.

These takeaways emphasise the importance of careful planning and consideration in various aspects of business expansion, from supply chain management and budgeting to maintaining brand integrity, health and safety, team management, and understanding international laws.

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1. Your Supply Chain

Depending on the kind of business you run, there will be a different kind of supply chain. If you provide goods, your business expansion plan must accommodate increased supply. If you work with small suppliers who are local and do not run a large operation, your relationship with them may have to change or be ended in order to meet the demand of your new customers.

Similarly, your expansion plans should allow for extra ordering and large supply. This is because if you expand without enough stock, your customers will begin to mistrust your business and see it as unreliable. Over-stocking in the first few months of expansion will allow you a safety net, so you know you can fall back on your preparations if there is a surge in demand.

2. Room For Error In The Budget

Think of expanding your business as a financial risk. Just like starting a business from scratch, you never know which way the wind will blow until you give it a try. Of course, with an established small business it is easier to continue your marketing and gain new customers, but even so, be prepared for some failures. Your customer base may take some months, or even years, to adjust to the newest version of your business model. With that, some financial losses may be made.

So in order to expand your business, there must be room for dips in your budget. If the money is still tight heading into expansion, it is better to wait it out and be more prepared for future plans.

Expand Your Business
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3. Losing Your Brand

If your business’ brand is built on local, personal goods and services, it may be unwise to expand. Or, at the very least, your expansion must be carefully planned in order not to alienate your customer base.

For example, if you run an organic health and wellness store in a small town which is booming, you may consider franchising your business. While this would be lucrative for you as the business owner, be careful that the community-focused aspects of your business model remain. If your customers feel you have ‘sold out’ and turned corporate, they may go elsewhere. Your brand is essential to keeping customers returning to you each time, so always keep your customers’ sights in full view when considering an expansion.

4. Health And Safety Implementation

With great power comes great responsibility, and with expansion come more boxes to tick. If you expand your goods from a container into a multi-level warehouse, for example, the health and safety concerns will increase rapidly. Your workers will have to undergo extra training paid for by your company; you will have to invest in an air tester and other equipment which maintains fire and flood safety.

All this, of course, costs money. Your expansion will throw extra costs at you left, right and center. To avoid being blindsided by bills, research and seek advice on your health and safety needs before you expand.

Health And Safety Implementation
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5. Your New Bigger Team

Running a small business means you, the business owner, are able to oversee and control most day to day operations and decisions that take place. Expanding is a different story. You will need to delegate power and responsibility to new staff members such as a head of operations, a marketing director or a general manager. This will mean relaxing your grip of control over every detail, and assuming your new position as an overseer of all operations. If you tend to sweat the small stuff as a business owner, expanding will mean adjusting to your new team of staff, and adjusting to your new role too.

Plus, more staff is more outgoing money. Never forget to budget for fair wages, holidays, and benefits.

6. International Business Law

Expanding your business within your home country is one thing; growing beyond the borders into new territory is a whole other ballgame. With a new country comes new cashflow prospects and a whole new customer base whose culture, economics and laws may clash with your branding and way of running things. Ensure you take legal advice if you are planning outward expansion into new countries.

When considering international expansion, it's crucial to understand the specific legal requirements of each country. Navigating these diverse legal landscapes can be challenging, but essential for successful global growth. For expert assistance in this area, especially if you're looking to expand into South America, Brazil Counsel offers specialized legal guidance to help you comply with local laws and regulations, ensuring a smooth transition into new markets.


Expanding your business is an exciting prospect, there’s no doubt about it. The prospect of bigger profit margins and the ability to provide your goods and services to a larger customer base is enough to keep anyone up at night. If you are considering expansion, make sure to use this guide in order to spot any hazards on the horizon.

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