For many small businesses, the first sign of growth and success is the purchasing of a new, and bigger, business location. It’s one of the initial pieces of advice often given within articles pertaining to successful business expansion, as real estate continues to be a solid investment for many companies who are able to undertake the move. However, when you feel that you are in a position to purchase a larger business premises for your growing company, there are some considerations to undertake. BloomSmith have observed and helped many business owners take this step, so we’ve collated below the most notable points to consider when you’re preparing for this.
Understand Your Industry Growth
Before you can confidently ascertain your potential business growth, you must understand the potential growth within your industry. You may be seeing exponential growth within your own business, but if the overall industry is beginning to decline, this is likely to impact your own company at some point in the future. If you can notice a market decline for your goods or services before you feel it yourself, you can implement contingency plans – which may mean holding back on using property to expand your business until you can guarantee more stability.
Understand Your Business Growth
Once you can feel confident on the stability or growth of your industry, you can look to your own company. Seeing a surge in profit makes many business owners want to capitalise on this peak; however, this can be misleading and could be unsustainable. The optimum position to be in to then expand your business is a consistent, steady growth. Ignore outlying profit surges and take note of the overall trend of your bottom-line profit over the years. This will show you whether you’re likely to be able to uphold a big business expansion in the form of property.
Consider Your Staff Growth
Purchasing and opening a new business location will require an uptick in staff resources; whether this means taking on more staff or expecting more from your existing ones, you cannot expect the existing work structure to naturally grow to fill a bigger premises. Ideally, you will develop staff to take on a growth in responsibility to oversee the move, run potentially new departments, and maintain current working standards within the larger space.
Obtain Funding to Expand Your Business
Once you are confident that your company structure and likely profit can withstand a large move, it is time to look at commercial premises and obtaining the funding to purchase one. Finding the right building is one battle, but ensuring that all of the costs of purchase are covered is another battle entirely – one that can often have hidden problems. We have spoken extensively about obtaining VAT funding for commercial property investment, so you can be confident that there is a solution to this charge with BloomSmith. However, you will also likely be looking for financing from other lenders, in the same way as you would when purchasing a domestic premises. Shop around to discover the best options for your situation, and do this before you make any large decisions to expand your business through a property purchase.
If you’re looking to expand your business and are considering a commercial property purchase, make sure to speak with BloomSmith for a full and unsecured loan to cover the VAT charge. With one less financial concern to consider, you can focus your attention on ensuring each element of your business will be able to meet and maintain this level of growth. Call us today on 020 3488 3411 or email us at [email protected]