How Can I Grow My Home-Based Business?
Enter the Project Grow Challenge presented by Entrepreneur and Canon USA for a chance to win up to $25,000 in funding for your business. Deadline is Sept. 15 2015. Click here to enter.
It's ambitious to think big and try to expand your business beyond your home. To do so, you're probably going to have to go out of your comfort zone and explore opportunities that may become challenging without prior experience scaling a business. Still, it’s typically worth it in the end.
First, you need to identify specific ways to substantially increase your customer base. You have a few options to consider. You can expand your footprint by opening a physical store in an affluent community and repeating that strategy in other communities. However, for this type of business, I wouldn't recommend that approach as it is very capital intensive with potential high rental rates and marketing costs. Scaling would be difficult as well.
Another option you may want to consider is expanding what you're already doing by hiring a sales and delivery force to bring the gift wrapping service to the client’s home. The highly affluent will pay for convenience and personal attention, which is what you can offer without having to spend money on rent. I would also recommend that you incorporate a smart phone application that allows clients to enter days in which they need to buy a gift (i.e. birthdays) as well as the ability to notify you that they are making a gift purchase. The data and functionality will become very valuable as the business scales.
I would also try to identify and work with distribution partners. There are many businesses and social clubs that cater to the high-end consumer. You can offer your services through a distribution partner as an add-on to their existing offering. This strategy is effective in that the upfront cost will be limited to your production expenses. However, you'll likely have to work under a revenue share program, which can hurt your margins. In addition, the lead times to get a partner on board can be long or at least 90 days.
Along with developing a plan to grow your sales, you need to identify the sources of financing to fund production and headcount costs. It's also likely that you'll need to negotiate larger orders with your suppliers as well as hire employees in sales, procurement and in administrative functions. From a financing perspective, a bank loan may be sufficient or you'll need to seek out equity investors such as a consortium of angels. It may also be possible to offer a distribution partner some equity for funding the expansion.
Once you have a plan in place, the next and possibly most draining part is pitching your plan to prospective employees, investors and other interested parties. It will likely take time, but try to get warm introductions, that is, referrals from people you know, and create a smart pitch with a clear slide presentation. You’re not just pitching the business, you’re also pitching yourself.