Transitioning from a small to a large business: knowing when it is time to make the move

Transitioning a small business into a larger one poses many challenges and requires a long-term growth strategy. Finance, storage, distribution and staffing are just some of the key barriers to expansion. So how can small businesses confidently embrace growth? Leading storage and materials handling specialist, Dexion offers four essential tips for surviving the transition.

1. Knowing when to expand

It sounds simple enough, but for Dexion Acacia Ridge (QLD) franchise owner, Ross Beaton it is the number one mistake that small businesses make.

“We see it all the time – small businesses that have experienced growth, suddenly lack the space and resources to accommodate expansion. While many businesses seek out financial and management advice, the issue of space and storage is often neglected, until it is too late,” observed Beaton.

According to Dexion Liverpool and Alexandria (NSW) franchise owner, Bill Case many small businesses are so busy trying to accommodate increased customer demand that they suddenly have no room to store their products, inventory or staff.

“On many occasions, we are approached by clients who say ‘we are moving next week and we need a new office fitout or a warehouse full of racking’. It is astounding how businesses can be just days away from moving facilities and yet have no storage solution in place,” commented Case.

Case and Beaton agree that the only way to overcome this challenge is to know when it is time to expand. Transitioning businesses must accept that what may have sufficed for a small business will not be appropriate for a business double, or triple, the size.

“Businesses must understand how they are growing, which requires regular and extensive planning. It is the only way to avoid a situation where a business suddenly runs out of work space,” noted Beaton.

2. Staying on top of market activity

As businesses tip the scale from small to large, they must maintain a solid understanding of their customers’ needs in the context of a fast-paced evolving market – to ensure that their products and services get to where they need to be as quickly as possible.

According to Case, this is particularly true for the manufacturing, logistics and FMCG industries where today’s customers are more demanding than ever.

“10 or 20 years ago, the challenge for many manufacturing and FMCG businesses was how to get more product into their warehouses; now it is how do they get more product through their warehouses,” observed Case.

3. Accommodating more staff

A growing business requires more staff. It is a proposition that is glaringly obvious, but one upon which, according to Beaton, many businesses stumble.

“Often during a business’ expansion, attention is directed at the financial aspect of investing in new staff. The result is that little or no thought is given to how these staff members will be accommodated in the existing facility,” said Beaton.

While more commercial businesses are moving towards activity-based workplaces (ABWs), which reduce the challenge of limited desk space, ABWs are not without their own challenges. Storage of both documentation and personal belongings must be adapted to the existing space available.

As for the manufacturing industry, an increase in staff often comes with a more complex supply chain – one that needs to accommodate both management and warehouse staff.

“Transitioning businesses must accept that the storage needs of a large organisation are very different from those of a small one and trying to adapt the former to the latter will never work,” said Case.

So what is the solution?

“The only way to avoid running out of space is by forward planning. As our own NSW franchise grew, we held regular meetings to address the evolving needs of our business and the associated demands of a larger staff base,” explained Case.

4. Bigger needs to be better

Although it is difficult to predict where a business might be in five years’ time, there are steps that can be taken to avoid a situation of outgrowing a facility just 12 or 24 months after moving in.

“Again, it comes back to forward planning, which means choosing the right facility from the outset – one that has the capacity for increased storage space,” noted Case.

It is also about managing stock and inventory cleverly.

How can Dexion help?

Dexion provides Australia’s broadest range of business storage solutions and is armed with the expertise and first-hand experience necessary to assist small businesses during the transition to a larger setup.

Dexion’s team of knowledgeable staff provide appropriate and accurate advice, with demonstrations available across well-stocked local showrooms nationally. In addition, Dexion offers a consultancy service, can provide design expertise and is qualified to conduct rack inspections across all business segments.

“We work closely with our customers to facilitate growth – from a space optimisation perspective, this means understanding the business. Often customers come to us requesting a particular product. Our response is to ask a series of questions, analyse the information provided and only then deliver a tailored solution, which may or may not involve the initial product requested,” said Beaton.

Operating across the Asia Pacific region and the Middle East, Dexion provides storage solutions for both the industrial and commercial sectors, including:

• Pallet racking, shelving and integrated systems

• Filing solutions including cabinets, shelving, lockers and mobile storage

To learn more about how Dexion can assist your business’ growth, call 1800 100 050.