Warning to growing businesses: do not delay plans for expansion
Transitioning a small business into a larger one poses many challenges and requires a long-term growth strategy. Finance, storage, distribution and staffing are just some of the key barriers to expansion.
Leading storage and materials handling specialist, Dexion has identified four key mistakes businesses make during this period of transition. These are:
1. Not knowing when to expand
2. A lack of understanding of the market
3. Failing to accommodate a larger staff base
4. Limited foresight when it comes to storage planning
According to Dexion Acacia Ridge (QLD) franchise owner, Ross Beaton not knowing when to expand is the number one mistake that small businesses make.
“We see it all the time – small businesses that have experienced growth, suddenly lack the space and resources to accommodate expansion. While many businesses seek out financial and management advice, the issue of space and storage is often neglected, until it is too late,” said Beaton
Dexion Liverpool and Alexandria (NSW) franchise owner, Bill Case adds that the only way to overcome this challenge is to accept that what may have sufficed for a small business will not be appropriate for a business double, or triple, the size.
“Businesses must understand how they are growing, which requires regular and extensive planning. It is the only way to avoid a situation where a business has suddenly run out of workspace,” noted Case.
They must also maintain a solid understanding of their customers’ needs in the context of a fast-paced evolving market. This is particularly true for the manufacturing, logistics and FMCG industries where today’s customers are more demanding than ever.
“10 or 20 years ago, the challenge for many manufacturing and FMCG businesses was how to get more product into their warehouses; now it is how do they get more product through their warehouses,” observed Case.
A growing business requires more staff. It is a proposition that is glaringly obvious, but one upon which many businesses stumble.
Often during expansion, attention is directed at the financial aspect of investing in new staff. The result is that little or no thought is given to how these staff members will be accommodated in the existing facility.
Transitioning businesses must accept that the storage needs of a larger organisation are very different from those of a small one – trying to adapt the former to the latter will never work. The only way to avoid running out of space is by adequate forecasting.
Although it is difficult to predict where a business might be in five years’ time, there are steps that can be taken to avoid a situation of outgrowing a facility just 12 or 24 months after moving in.
“Again, it comes back to forward planning, which means choosing the right facility from the outset – one that has the capacity for increased storage space,” noted Case.
To learn more about how Dexion can assist your business’ growth, please call 1800 100 050.