If you’re wondering “How can I grow my business”, and considering opening a new location to do so, you have a lot of research ahead of you.
There might be a few reasons that you’re considering opening a new location as a way to grow your business, such as:
- You’ve identified an un-served or under-served marketplace, and you want to fill the void – and reap the profits.
- You want to reduce a competitor’s market share – particularly if they’re stealing your current and future customers.
- You want to achieve economies of scale. Often, buying inventory for multiple locations typically means you can get a better deal and/or friendlier payment terms.
- You want to mitigate the risk of one location sending your entire business into a tailspin if it has a particularly bad few months or quarters.
- You want to win over more business from enterprise-level customers. Having multiple locations adds to your capacity and profile.
Those are just a few reasons how opening a new location can help you grow your business, and understanding how to make that happen can often make your head spin. With so many considerations, we’ll at least help dig into some of the most important ones.
Costs of expanding to a new location for your growing business
One of the most important considerations when thinking about financing to grow your business is around the costs involved. Beyond just the additional rent, lease or mortgage payments, utility bills and insurance premiums, here are some costs you may not have considered:
- Renovating the new location or taking care of necessary leasehold improvements. This can include both interior and exterior upgrades.
- Advertising and marketing costs, to let customers in your new service area know that you’re “open for business”.
- Recruiting staff to work in the new location. This can be tough to do (and may cost more than you’d like) in marketplaces where the demand for qualified talent is high.
- Installing equipment, and setting up networks and telecom systems.
Who should I borrow from to grow my business?
This is often one of the most difficult decisions for any small or medium sized company looking to grow their business. How do you know who to trust? What should you look for in a lender? As a first step, here are some things to think about:
- Should you get a secured or unsecured loan?
- Do you want to go for a short term or long term loan?
- How quickly do you need funding?
- Are you looking for a lender equipped to approve loans in-house?
- Is it important that your loan be customized for you and your business?
- Do the lenders you’re considering have a good reputation?
The Bottom Line
As you can see, a business line of credit gives you the security in knowing that your expansion plans won’t be delayed – or worse, derailed – because of extra costs. Unlike a bank loan, you only pay interest on the amount you borrow – so there’s no risk if you end up needing less cash than you anticipated.
Call Mulligan Funding at 855-326-3564 to discuss your financing options today!
The information shared is intended to be used for informational purposes only and you should independently research and verify.
Note: Prior to January 23, 2020, Mulligan Funding operated solely as a direct lender, originating all of its own loans and Merchant Cash Advance contracts. From that date onwards, the majority of funding offered by Mulligan Funding will be by Loans originated by FinWise Bank, a Utah-chartered Bank, pursuant to a Loan Program conducted jointly by Mulligan Funding and FinWise Bank.