Local business owners share their experiences of taking their companies to the next level.
Growth is always exciting for a company. Expanding into a new location with a satellite office, warehouse, or other facility in another state or even country is what every business owner dreams of, because it signifies success and lucrative opportunities. However, the entire process of expanding into a new area takes a significant amount of advanced planning and patience.
When expanding into another state, it is important to plan well in advance—years even—before the actual opening of the door to the new office. Rachel Lilienthal Stark, who practices business and corporate law at Stark & Stark in Marlton, advises businesses to file a trademark registration well ahead of time. “When a company first forms or first considers expanding, it should be certain that its name and trademark are available in other markets,” she says. “It must file the necessary federal and international trademark registrations. This is particularly important for companies that plan to eventually franchise.”
Tax issues, labor and employment laws, licensing, and certificates of occupancy are also critical details that come into play when a company expands into another location, and can cause headaches if business owners aren’t prepared. “An attorney will advise the business about what steps need to be taken to open another office,” Stark says. “That might require contacting an attorney in the specific area to determine what requirements must be fulfilled beforehand.”
An example of this company growth is Checkpoint Systems, Inc. The company is a manufacturer of technology-based theft prevention, inventory management and labeling solutions for the retail industry. It has expanded globally since it was established in 1969, and today, Checkpoint employs more than 4,700 employees in 28 countries and boasts more than $600 million in annual revenues. So how did Checkpoint grow into a multi-million dollar company from its humble beginnings over the past few decades? The company actually has its quality customer base to thank for cultivating new business opportunities.
“We began with a good product that needed to be proven and we worked with local retailers to gain their business,” says Carlos Perez, Checkpoint’s Vice President of Global Marketing. “As our customer base expanded beyond local markets, it required us to grow with them and expand into other regions both here in the U.S. and internationally. As the need for our specific product solutions continued to increase, we needed to expand our messaging, reach, and ability to sell, service, and support other retailers who were perhaps unfamiliar with Checkpoint and show them what we had to offer.”
Keeping customers happy—which can be attributed to boosting sales potential—is another reason the company expanded its business. After determining that an existing customer base in Mexico had the potential to flourish even more with a local staff, Checkpoint opened an office there. The customers were already being serviced by sales representatives in the U.S., but the new office seemed like the right step to take to better serve the local clientele. Checkpoint also assembled a management team to lead the Mexican office and contacted recruiters to hire a sales staff. It has used the same model in every country in which it operates.
Another local business that has experienced similar needs for expansion is Delaware Valley Floral Group. Located in Sewell, DVFG was founded in 1959 and has grown from a small provider of fresh flowers and floral supplies to the local area to one of the largest floral distribution companies in the nation, with facilities in 10 states.
The company has been family-owned and operated since its inception. Its employees are the basis for its continued growth, says Kenneth Wilkins, vice president of business development and grandson of the founders. “Having qualified employees is just as important as having the capital necessary to expand,” he says.
“Hiring good managers, salespeople, drivers, etc., are critical because the further away that you expand from your headquarters, the more you need to rely on the staff to build up the business in that location and keep things running.”
Setting the tone for how things operate begins at home, but that attitude has to be conveyed at every other location to ensure a unified business structure, he says. “Most small businesses start out with one location and everyone works together to set the culture for the company,” Wilkins says. “The owners determine and establish the company’s values, sharing this with their employees every single work day. Expanding away from home is a challenge, because the culture that has been established must continue.
“Owners have to ask themselves: ‘How do I hire the right people? How do I treat them so that they value working for the company and serving our customers? How do we extend to our staff the ways we want the company run so that our organization continues going in the direction that is consistent with our core values?’”
Checkpoint abides by a similar philosophy.
“Think globally, act locally,” says Carlos Perez. “We want to service the entire global market, but we realize that we cannot just provide that service from our Thorofare location. Instead, we have to have a local presence, too. As we keep growing, we have to properly staff our offices around the world to support our retail customers.”
Finally, it’s important to note that once a company decides it’s time to expand, setting up a cohesive plan is the first step. Stark says that opening up a new office out of state should be treated much like planning a large event. “There’s a lot of preparation involved. It’s best to settle on an opening date for the new office and then work backwards to achieve all that needs to be done in terms of financing and licensing. Setting a timeline is a great idea for moving the process along.”
Published (and copyrighted) in South Jersey Biz, Volume 4, Issue 7 (July, 2014).
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