In Minor's League: Feb. 2001

ANSWER: This is a common scenario and dilemma encountered by many entrepreneurial ventures. You’ve built a good landscape business and now you’re ready for the next step. Geographic expansion is usually the first thought entrepreneurs have when considering growing their businesses. Before taking that big leap, however, there are plenty of issues to consider and many points to think about that may not make this step seem so attractive for your company at this time.

For example, ask yourself: Are you absolutely sure you want the headaches associated with geographic expansion? There are many ways to grow your business and maintain quality of life without moving into different markets. Venturing into different markets usually means more time away from home or more time driving in your car. If you have a spouse and children, remember, there will be a trade off. Ask yourself if the appeal of a multi-site business is worth the time away from home. If having balance in your life is important, know that you will increase the challenges associated with maintaining that balance if you’re always on the road. Only you can make that type of quality of life decision.

Plus, there are many other effective ways to grow your business that may be attractive options. Before opening new offices you might want to consider growing your revenue through the addition of a new product or service. For example, if you provide landscape maintenance services, you would obviously want to consider construction, design/build, irrigation or Christmas decorating as potential add-on options.

Another option is to expand your customer base. If you provide services for multi-family communities, look at corporate customers, homeowners’ associations or even single-family residential work.

The other obvious way to grow is to simply improve and/or expand your marketing efforts. Many companies want to open up new branches when they have not yet maximized the potential in their existing markets. Even a business with $3 million in annual revenue in a major market has a long way to go before exploring different markets. Why add to your headaches until you’re sure you’ve reached your potential?

I should also mention the importance of maintaining your bottom line before branching out. Too often, I see companies with low operating margins try to increase their overall profits by expanding. Why not just improve your systems and grow the bottom line instead of just focusing on top line growth?

Improving your service delivery systems and financial controls is usually a better place to start than opening new offices. It may not be as “sexy” as owning a multi-site operation, but this approach to growth often comes with fewer headaches, travel and risk.

If expanding your business into other markets is part of your company’s growth plan, first conduct a thoughtful evaluation of your current situation before tackling that next big entrepreneurial challenge. Certainly, there are many good reasons to grow by branching out, adding products and services, expanding your customer base and improving marketing tactics. Just remember to do it when you are truly prepared and for the right reasons.