Know When to Grow
“My interest was in our customers,” says Whitlock. “How could I continue that relationship and better service their needs?” The new move was the answer for Whitlock, who opened the original Winyah in 2004.
Many small and midsize business owners are as optimistic as Whitlock about growth this year. In a 2015 survey, SunTrust Banks found that 78% of businesses with $2 million to $10 million in revenue are preparing for growth. But roughly a quarter of those surveyed reported that they had done little or no planning for expansion.
Here are some of the key issues the team at Winyah Pharmacy addressed as they developed a strategy.
PositioningA successful business combined with solid economic conditions can push a team toward favoring expansion, but is the current structure positioned to succeed? If you plan to expand, ask yourself a few questions:
- Will growth give the business a competitive advantage?
- Has your business model been tested?
- Do you have the management team, facilities, and equipment to handle the growth?
ResearchHomework, and plenty of it, is crucial for a successful growth plan. Winyah’s team carefully worked through the financial aspects of the deal long before any paperwork was signed. It also did an analysis of the market and its need for the services the pharmacy planned to offer. When branching out into a new market, consider the following questions:
- What is the population of consumers in your target demographic, or, if you serve businesses, the total number of potential clients in the new market? Contact the Chamber of Commerce in your target market to find out what data is available.
- Are there any existing businesses providing similar services—or newcomers who plan to open up in the area in the near future? How will their presence affect the success of your operations?
- How healthy is the local economy in the area you are planning to move into?
TimingThe economy and conditions in your industry can either put the wind at your back or hit you with headwinds that slow you down. Conditions can change overnight so don’t get so immersed in your plans that you lose sight of the big picture for your business. When Whitlock realized he’d found the right partners and that the market could support their shared endeavors, he moved ahead quickly with his plans for the third location.
If you’ve done your due diligence and have found that a new market can support your business, create a timetable for your expansion and stick with it as much as possible to avoid losing the opportunity to a speedier rival.
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