Expanding Too Much
Dave doesn't want Carol to get ahead of herself by expanding her small upholstery business too far too fast.
QUESTION: Carol owns a small upholstery business that she runs out of her garage. She wants to expand to a bigger shop. Should she sell her property and have a bigger shop built or not?
ANSWER: Before I’d do that, I’d probably rent. You’re just talking about renting a garage space for now. Do that until the business is really rocking to the level that justifies the square footage you’re talking about before you get into the building and real estate business.
If you get too much and then find out that you can’t put enough volume out there to justify having a shop that size, that’s going to be ugly.