Every entrepreneur wants to open and grow the business of his or her dreams, eventually expanding to open a second (and even third, tenth, fiftieth) location. In hindsight, expansion could’ve gone more smoothly had they taken a few simple precautions when the business was just getting started.
Name: First off, did you pick a company name that can carry you through changes in trends and market fluctuations? Choosing a trendy business name could date you later on, or you could be seen as behind the times to customers. And what if the vision of your business shifts as the market demand shifts? Say you’re doing business as Golf Balls Only. If you decide you want to sell more than just balls, you could confuse your customer. If you pick a specific yet encompassing name, you’ll be able to add and omit services, or products, and stay in step with market needs.
Structure: Although it is possible to change your business structure later on, the smarter move is to do your homework at the start and set up a structure that will work for you as you grow. C corporation, S corporation, Limited Liability Corporation (LLC)—this is not a decision to be made lightly. Read “The Differences Between C and S Corporations” and research the IRS Web site, then talk to a trusted accountant. What is best for your business and for you as the owner? If you expect to have investors either now or at some time in the future, what’s the best structure to entice them?
Trademarks: Register your trademark right from the start so someone doesn’t steal the idea out from under your business. The U.S. Patent and Trademark office is a great place to start your search. You’ll learn the difference between a trademark, copyright, and patent. The Trademark Office only handles trademarks, but since that includes protecting words, names, symbols, sounds, or colors that distinguish goods and services, you’ll mostly likely want to trademark your business name and logo. Find out the rules for registering and protecting your trademark; you can apply online.
Operations: Be sure to create an organizational structure that makes sense for your business, but is flexible enough to change when the circumstances call for it. For example, you should always be grooming another “you” to operate another location when you’re ready to expand. Does everyone in your business have an equal say in decisions, or do you need to appoint a manager so there are few conflicts? Write an employee and operations manual from the beginning so when you’re a chain, the systems will be in place.
Financing: Plan now how you will finance your growth. This means creating a business plan and keeping your finances in order. Build strong banking relationships and let your bankers know your future goals so they can work with you to get you there. Keep your eye out for financial opportunities and be ready to jump on them–be flexible enough to move up your expansion date if you need to take advantage of circumstances.
Marketing: Build your brand from the beginning and make sure everything you do (advertising, promotional materials, events, and more) reinforces your brand. How you communicate to your customer and the impression you leave will carry over when you expand. If you do branding well, your new location should be a success from the start.
Equipment: Make sure your business equipment can grow as your business grows. You don’t want to spend tons of money upgrading everything because you went too basic and cheap in the beginning. This only wastes valuable working capital that could be spent on your next location. Think about your computers, servers, phone systems, copiers, printers and more. You may have four people in your office and one printer is plenty for now, but can you add more users to your printer as you add employees? Are your phone systems able to connect with the system at your next location, or will you need a whole new type of system? Will your server be able to handle more than one location or Web site? Talk to your equipment sales reps and explain your needs and where you expect your business to be in one year, three years, and even ten years.
Maria Valdez Haubrich is Chief Liaison Officer of GrowBiz Media (http://www.growbizmedia.com/), a content and consulting company that provides information, advice, and resources to help entrepreneurs start and grow their businesses.