When Is It Time To Expand?

Perhaps the greatest thing in the world is being your own boss. Apart from working for your own pleasure, you get to create employment. Whether this is for a few people or hundreds the feeling is great. Great customer service and products will guarantee success after a period of time.

As a result of success, you will be forced to expand your business due to the growing demand. You will probably need the services of a custom software development company to develop new systems. The systems will guarantee the continued success of your business. However, the most important question is when should I expand my business? Here are instances you should consider expanding your business:

Customer base

Your customer base is a big determinant of whether to expand your business. A growing customer base will equate to an increase in sales of your goods. The customer base will likely be a new market i.e. different town or city. This will require your business to expand into this market so as to satisfy the new customer base.

Another scenario is where your customers increased in purchasing power. Their new ability will lead to an increase in your sales since they will be able to buy more of your product.


Expansion may be in order if your product is unique in the market. A great product that is unique will have great sales revenue. If your product fits this criterion you might be up for expansion sooner than you think.

Praises of your product will spread like wildfire leading to an increase in sales. naturally, demand rises, supply will have to follow suit meaning there will be a dire need for expansion to cater for increased production.


The business world is murky yet filled with intrigue. You could have competitors one day and none the next day. This could be due to a change in government policy or expense of raw material. Whichever the reason you have to seize the opportunity once it presents itself.

In anticipation of being the market leader expand your production and target new markets. This guarantees customers don’t have a vacuum once they require the product. In no time you’ll have recouped the amount spent on expansion.

Economies of scale

It would make more sense for your business to expand if it were to experience advantages if it did so. An example of this situation is where you get to purchase the product at a cheaper price since you’re buying in bulk. This would translate to a positive increase in the profit margin.

Once you expand your business you’re able to handle collusion between competitors. Should your competitors decide to gang up on you and drop their prices? You will be able to drop your prices and still experience same profits since you’ll be in more markets.


Location matters when deciding to expand your business. Should the location of your new market be far from the original market, you’ll be forced to expand. This is because it could be more expensive to transport the goods rather than establishing a plant in the long-term.