What to consider before expanding your business out of state

By Anica Oaks

There are many advantages to expanding your business to other states. It increases your customer base, and it gives your brand greater authority as a national brand rather than a local mom-and-pop shop. However, when you move across borders, you have to be certain that it’s the right time to do so. Also, there are legal details and regulations that you have to be aware of. Here are some things to consider before you take this leap.

Is this move right for your business?

If your business model is working great with 30 employees, it doesn’t necessarily mean it will work with 300 or even 3,000. Have you done your homework about how your brand, products and infrastructure will function as it scales up? Are you ready to handle greater operating costs? Do you have a team that can handle this increase in business operations? Will you or someone you trust be able and accessible for training out-of-state employees on a regular basis? If your brand has charm as a local shop, make sure it is viable as a national brand as well. If necessary, rebrand the business to fit a wider market.

Can you trust your out-of-state managers?

If your business expands across a large geographical area, you can’t be at every location in person. The issue of trust becomes much more important when someone else is running warehouses, plants, stores, or even offices. Make sure your partners or managers share your vision and are willing to adhere to your guidelines when you’re not around. If a lot of locations are opening in other states, you might need to establish a division of your company that handles out-of-state operations. Few things are worse for a business (and its employees) than inconsistent operations.

Monitoring systems

There are a variety of technical solutions today that can help you monitor your multi-state enterprise. Software systems can keep track of logistics in real time, and they can report on sales, inventory and other vital factors the moment these things change. Whether you’re selling donuts or ute trays, this information is helpful for making decisions about product placement and strategies to scale up the business. Check this data regularly to ensure that the decisions you’re making are right for either the whole company or if you need to deviate for different branches of your business.

Is your business compliant with out-of-state regulations?

If your business provides service technicians that require licenses, make sure they meet the requirements in the new areas where they will be working. Certain products and services need to adhere to state laws that could be different from one state to another. Also, when your business goes to new states, you might need to change your corporate tax filing structure. It is best to have a business attorney who can handle some of these trickier issues and guidelines for you.

If your business is thriving so well that it feels right to expand across state borders, this can be a thrilling time in your life. Just make sure you’ve done all the research and taken all the necessary steps before you commit to this decision.


Anica Oaks is a professional content and copywriter who graduated from the University of San Francisco. She loves dogs, the ocean, and anything outdoor-related. You can connect with Anica on Twitter @AnicaOaks.

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