For some entrepreneurs, working from the comforts of home seems like a welcome option. With little overhead costs, little or no employees to manage, you can run the business any way you want. But when success comes knocking and the need for a bigger setup becomes necessary for the business to continue growing, looking for commercial space is often a must.

According to management consultant Oliver Juanir of BusinessPlanners.com, knowing when to expand a small business is an important decision.

"Grow too quickly and you can take on costs your business may not be able to support. More importantly, grow too slowly and you may miss out on valuable opportunities. Make sure your plans fit with market conditions and with your personal goals," he said.

When the time comes that you think you've outgrown your home office, the most important step is to analyze the costs associated with making your move before signing a lease.

"Consider lower-cost options such as leasing shared space or executive suites, which typically provide receptionist services as well as use of conference rooms and office equipment. A commercial real estate agent may be able to help you find the space that's right for you. Map out all your expenses, and double check it with your cash flow and expected revenue streams," Juanir said.

A SLOW AND STEADY APPROACH

For internet marketing professional Kenneth Magno, the idea of expanding his business outside his home office has come to him often this past year, as his business has registered steady growth. Lately, he's increasingly found himself freelancing work to other professionals because he needed the extra assistance. So a few months back, he started looking at office space to house his growing business. 

"I've looked at 20 different places in a span of six months, but still haven't found the type of place that I want. They're either too expensive or too small for the kind of business I want to do. So now, I'm still running things from my house," he said.

Juanir says Magno's was right not to rush into leasing office space. He counsels other entrepreneurs looking to expand their home based business to carefully consider their needs and financial capabilities before making the jump. He says hiring employees and investing in an office is much easier said than done.

"When it gets to the point where you need an employee then you've probably outgrown the home. However, make sure that your finances are in order before getting that office space. Check your cash flow, study your market. Do you have a steady stream of customers that can sustain your growth?," Juanir said.

One way of expanding without leaving your home is by forming a network with other businesses that compliment your existing services. With communication easier because of the internet, small business groups are finding it easier to band together and make use of their strengths to gain clients. Magno has recently joined a network of marketing professionals that specialize in web and mobile marketing, and the results have been favorable so far.

"We leverage our existing operations to compliment each other. What the other company lacks, the others have, so we basically plug our weaknesses. This new group has helped me expand my client base, and I've expanded without needing an office space to grow," he said.

STAY AT HOME, BUT HAVE A PLAN

If you're not quite ready to upend that homebased lifestyle you've come to know and love- yet you still need to do some expanding- there's a bevy of options to consider.

Maia Lumbao runs a small garments business that specializes in baby clothes. She started the business in 2000 with just P40,000 in capital, and has grown it to a small size company that earned P2 million last year. She has thought of getting an office to house her business, but has recently decided to expand her home office instead.

"I have a big lot, and I thought about the expenses an office would have so I decided just to build an extension to my home office. This is actually the second expansion I have undergone, three years ago I built a small shop for my seamstresses at the back of my house. Now, I have 8 of them and three other employees, so I decided to invest in just constructing an adjacent wing that connects to my house," she said.

Although she is pleased with the results of her home expansion plans, she is still planning to move into a formal office space when her finances are ready for it. 

"I can imagine my lot getting cramped as the business grows, and I need more employees. Plus, as more people come and go from my house, I think the security risk is becoming greater. Moving to an office space is definitely my strategy for long term growth," Lumbao said.

Revisit your business plan and factor in the new plans into it. With the data you have on hand, you can now see how the new, larger business will work on paper. But at the end of the day both Magno and Lumbao say that entrepreneurs should go with their gut. Expansion may be tricky, but a person must want it to work before it succeeds.