How to Make Your Business Thrive in Just 6 Minutes | Overcome Competition Now

Hi, I'm Evan Carmichael. Welcome to another edition of Ask Evan. Today I'm answering a question from one of our newsletter readers, Alistair, who wrote in saying, "Hi Evan, just a quick question. Do you have any examples when would be the best time to expand the business? My situation is I bought an existing business, was quite successful for a small town, but the previous owner— lost my spot here— did not want to expand. I have 4 years until loans are paid off, but I'm kind of in a neutral zone. It's a signed business with a good customer base, but I now have some local competition, so I'm wondering if I should be pushing and going more risky forward or wait until debts are paid off and then expand. Alistair. Alistair. Okay, so thanks for the question. Great question. So my thoughts here I always like testing things and trying to make money before I'm spending money. So especially if you're in debt, obviously you want to try to pay off your debt before you spend a huge amount of money on a risky venture. But I don't like being too risky as an entrepreneur, and I think you have an opportunity here to look at potential expansion projects. I don't know what you have in mind to expand the business. Say you had, you know, 3 or 5 big ideas to be able to try to expand your business. Try to pick your top 3, 3 different ways, and I try to find a way to get it started without spending money as much as possible. On a small scale, without spending money, look at how you might be able to grow your business in each of those lines. And it'll be, it'll be small, right? It's not the big vision that you had, but I also don't want— I don't want to see you risk your business and go into something where you're gonna lose a lot of money and not get the returns that you're looking for and potentially have to close down. It's kind of a worst-case scenario. You know, you don't want to have the banks come and take your business away or your home or, you know, worse. But I also don't want to just see you sit by and not do anything. You know, you have competition coming in, and status quo is not a good business strategy, right? You can only do that for so long before your business is taken away from you by your competition and market changes. So You always have to be growing. You always have to be finding ways to expand and jump on the new curve and look at ways of doing things better and bringing in more customers and creating a better experience. So that's also one of the fun things about being an entrepreneur is going through those things and coming up with new ideas and thinking of ways to expand. But I wouldn't say be safe, you know, wait until 4 years before you try to expand. Maybe that's the advice you get from your banker. But I don't think that's a great strategy. I don't think that puts your business in the best position possible. Because 4 years from now, your competition may be way ahead of you. They may be eating your lunch. They may see a market opportunity where, you know, you've just been doing the same thing over and over again, and they're growing and tapping new markets that you haven't been able to get into because you played it too safe. But again, at the same time, I don't want you to risk everything, go crazy, and lose your business. So I would try to find the 3 ways that I would look at expanding my business, whatever ideas you have in mind, and start something on a small scale and invest your time and your energy into trying to make those things work, even on a small scale. If you can show that you can get a little bit of return on a small scale, then it's worth expanding. You know, your 3 ideas, you may find that one is a lot better than the others, and that's great. You know, at the start you never know. You have great ideas, you have great projections, but you really never know which one's gonna work out. It sounds great in theory, but you're not sure until you actually get into it if it's gonna work or not. So start on 3 things, test it really small, put your time into it, see if you can get some results. If you can find that people are hooking into it and are picking up on it and they're coming in and they're buying from you, again, even on a small scale, then it's worth expanding. And when you expand, again, you're starting small. When you, you're starting to put money in, you don't go plowing a whole bunch of money into the project. You start on a small scale. Again to make sure you're not making mistakes. Because chances are the first dollars you spend are not going to be spent perfectly. You know, you're gonna make mistakes doing it. And so better to make your mistakes on a small scale. And it's a great position to be in where you have a successful business, you're profitable, you have debt but you're slowly paying that back. And so you have a base to build on. If you can situate your company so that you can spend most of your time not running the business but looking at growth opportunities. That's a challenge for a lot of entrepreneurs is they're so in their business that they can't spend the time working on growing it. But at least have, you know, carve out some time for you to focus on new projects to build your business. And you're putting your time in, you're making sure that it works, then you invest a little bit of money to expand. And then if that works, then it's worth going for the bigger dollars. And you may have to get a loan, but again, just try to go out and bootstrap it. As much as possible. But you've shown that it works, right? When you're gonna put big money into it, you've already shown that by putting your time into it, it works, and by putting a little bit of money into it, it works. And so the risk is a lot lower. I don't think you have to take massive risks to be a successful entrepreneur. You just have to take small calculated risks and continue to expand upon that. So hopefully that helps. Maybe not the answer you're looking for, and I may have been taking the middle road a little bit here, but I don't think it's the best strategy to just wait for 4 years. And I also don't want you to go crazy risky and potentially lose your business. So that's how I would do it. That's how I built all my businesses, is bootstrap, small scale, invest your time, show that it works, and then expand beyond that. And it's a great way to build a solid, long-lasting, profitable business that you can enjoy for a long time or sell at a great premium to whoever wants to come in and buy it. So hopefully that helps, Alistair. Good luck with the business. For those of you watching, if you like the video, please give it a thumbs up. Makes me want to do more of these for you. And if you have a comment for Alistair or a comment about this video or a question for your own company, feel free to leave it in the section below. I always read those and I try to respond as soon as I can. And I'd love to try to answer questions for you guys as well. So thank you and I'll see you on the next episode.