So your first commercial office or retail location is doing great. Should you open another one? Adding a 2nd or 3rd office or retail space whether in the same city or another city and/or state offers many benefits such as:
- Expanding your brand
- Access to a new expansive service area and customers
- Increase total sales and profit
- Ability to respond more quickly to customers
There are many more reasons why you might open a remote business site, however before you do run the numbers, weigh the pros and cons, seek contingencies, and look for less expensive alternatives. Also, ask yourself a lot of questions. Below are a few to get you started.
- Is there a location that makes good business sense? – External factors such as location must be considered when evaluating expansion options. Before leasing or buying office or retail space make sure to thoroughly research each location looking at traffic patterns, proximity to vendors, partners, and competition, ease of access to and from, parking, etc. You also want to get a handle on the commercial real estate costs and rental rates. If your considering Austin, Tx for example a good Austin commercial real estate agent with experience in retail and office space can provided you with the information you need to make an informed decision.
- Are YOU the main person in your business? – Many small businesses rely on the owner of the company to operate. If the success of your company depends on you having to be there to meet people face to face there is no way you can be at 2 places at once. You will end up traveling more than you like. If your business stops because you are on vacation then you may not want a 2nd location. If you have a good team leader that can manage the business on their own then it might make sense to open another office or retail shop.
- Have you run the numbers? – If you are not from the city or location you want to open an Austin retail space in you may be surprised to find out the rental costs are much higher than your original location. Make sure you are able to afford running a second office. Below are a few things you should get estimates on first to ensure you can afford to have a 2nd location.
- Monthly rent estimates
- New fixtures, furniture, signage, office equipment, etc.
- Additional employees
- Competition – Need to factor how much business the competition might take away
- Business operations such as insurance, maintenance, utilities, communications between your locations
- Advertising costs for each location
- Remember your new brand office won't be profitable at first and your 1st location will have to support it. Make sure your main office is stable and profitable before expanding.
- Are you able to share operation systems between locations? – If you can avoid having redundant operations. Ideally you want to be able to handle as many business functions as you can with the current staff and avoid additional overhead if you can. What are you able to share the cost of and what separate costs will be necessary to run the new location?
- Can you maintain the quality of your service? – If your service quality drops when you open a new location you will lose customers and money. Don't let the new location be a drain on your original location and hurt your reputation. Your existing clients will come to expect the same level of service.
- Can you expand with other ways? – Before you open a 2nd office or retail store first ask yourself if there is a better way to increase your customer base and grow sales. Can you hire more people? Spend more money on advertising? Can you outsource jobs or projects? Can you extend your hours of operation? Can you expand your product or service offerings? Make sure to consider all the alternatives before making the decision to open a second location.
If after asking yourself all the questions above and more you determine that opening another location makes sense for your business get help to find space. For example an Austin commercial real estate company can help you in the South Central area. They will be experts in the Austin metro area and can help you identify and select a location that will be successful.