If you’re building your company from scratch, you’ve probably got a long list of goals you want to accomplish within a particular time frame. One of those goals is likely to be achieving consistent growth. You can do this a variety of ways, some of which are organic in nature, but you may want to do something different. You may want to expand your company offerings to provide new services. One way to do that is to acquire another business that is already set up and ready to go. It could be a merger, or it might be a company facing bankruptcy.
Regardless, there are a few points to consider before determining if it’s the right move for you.
When you’re deciding where you should expand, you need to determine if you have unique or valuable services. Of course, you believe that your services or products are essential or else you couldn’t be in business. The goal is to determine in which markets your services are needed. You may want to consider buildings or companies that already perform the services you might like to start offering and ensure that they are in a location without much competition to give you the upper hand.
This is going to take a lot of research, both on the pros and cons of the location, as well as the merge to a new type of service or product.
Replicate Your Business Model
Most entrepreneurs in this situation believe that it is best to come up with an entirely new approach to the business model. However, you’ve already got something that works, or else you could not still be running a business. Therefore, you may want to take the current formula and apply it to the new building, city, and service. It’s a daunting task, but it’s much easier in the long run.
Since your business model is already established, you’re more likely to flourish in the new location. Of course, this can still take a lot of time. Remember, you aren’t likely to find a new building, do all the research, and fine-tune your business model in less than a year. It’s likely to take several years or even a decade for everything to line up effectively.
If you’re planning to acquire a business, you need to focus on the team rather than the client base of the company. You need people who can foster and embrace your company’s culture for the acquisition to succeed. If you plan to keep the current employees, you might need to interview them and learn more about them. Remember, the employees from the acquisition or merge are likely to be nervous, upset, and anxious about this new change. However, acquisitions also tend to fail frequently because both organizations don’t have compatible cultures.
Build or Buy
When you’re considering an acquisition, you may wonder if you should fully merge with the other firm or grow organically. It might be easier to keep the current employees in place because they are likely to already have knowledge of the current market and know the ins and outs of the business.
However, you may not want to keep the current employees, especially if they seem hostile toward the merge and change. In this case, you may want to scrap it all and completely rethink the design of the building, as well as hire new employees.
Expanding your business into a new market is a terrifying process. You can find many benefits, but none of it matters if you don’t believe that it is all going to work out. There are going to be some hiccups along the way, but if you let yourself focus on what’s not going right, you aren’t going to have time to fix the problem and move on.