Opening a new business location can provide many advantages, from additional profits to increased brand exposure. However, there are essential steps to ensure the success of your expansion that many small business owners forget. Investing into opening a brand new location without sufficient preparation can be detrimental to your entire business operation. Therefore, it is essential to take these three steps prior to opening a new location.


If your original small business location is successful, that is not a guarantee that it can be replicated in another location. The first step you need to take when considering expansion is to research the market to see if there is an actual need for your products or services in that specific area. For example, a children’s indoor playground may be thriving in a suburban area with a large population of families with young children; however, this same business may not succeed in metropolitan areas where mostly singles and working professionals without families reside.

Once you determine if there is a need for your offering, research any possible competition that may already have a large portion of the market share. Competition alone should not prevent you from expanding, but you must be prepared to present a good argument as to why their clients should do business with you, whether it be lower prices, more unique offerings or better customer service.


Before you fully commit to opening another location, it may be advantageous to initially test the market to see how customers in that specific area will react to your offering. If you want to open a new brick and mortar restaurant location, consider sending a food truck into that area first. This will not only increase your brand exposure in that market, but will also provide feedback as to how well the public reacts to your menu and prices. Similarly, instead of opening a full-fledged store, you may start with a cart at the mall, which is a smaller investment and allows your sales representatives to actively market your products to individuals walking through the mall.


Many small business owners are perplexed when, after opening another location, it stands empty with no patrons. This is a typical mistake that has to do with a lack of a good marketing strategy that alerts residents that a new business has opened up. Unless your business is in a location with a lot of foot traffic, your potential clients may not be aware of your company’s existence.

To avoid this, you must allocate a budget and consult with a strategic marketing consultant on the best ways to reach your target audience. Your marketing plan can involve a variety of channels, such as television, internet and traditional marketing, such as fliers and coupons. You must be prepared to spend money on advertising for some time before your new location becomes profitable.

Although expanding your small business does require risk, this venture can be extremely profitable with the right preparation and commitment. The associated costs to research the market, conduct tests, put an effective marketing plan in effect, and pay for the actual location and new employees can be significant. However, careful planning and affordable capital can turn these costs into a lucrative new revenue stream.