Once you have your insurance agency up and running, you may be eager to consider the possibility of opening up a second location or satellite agency. I am all for this idea and I believe opening a second agency is a great opportunity for growth. However, as an agent, you want to make sure you have a good foundation in place at your current agency before you consider opening another.
There are two different ways to consider opening a second agency: purchase an existing agency or start a new one from scratch.
When purchasing an agency, you must consider if you will be able to leverage payroll, administration positions, appointment setting services, etc. Evaluate the current staffs’ abilities – will they be able to execute the systems you’ve set in place at your current agency? You’ll also want to make sure you have projected an adequate return on investment and that your financials are in order before moving forward. Purchasing a new agency can be costly and you must make sure you have a solid plan in place.
When starting a new agency from scratch, consider whether you have the right team members who can work from the ground up. Every successful agency starts with a clear vision and sound business plan. Starting an agency from infancy is a different animal than walking into an established agency. Either way, as an agency owner, you will be serving two masters in some form or fashion. You want to make sure you’re not being pulled into two directions. It’s a good idea to use the systems from your current agency at your second location. Develop a marketing plan, determine distribution, acquire staffing and create the groundwork for a thriving agency.
Over the years, I have worked with agencies that have opened multiple locations. These include agencies with locations both regionally, or out of state.
Ultimately, you want your second agency to be productive and profitable. Therefore, it’s best to wait to embark on the process of launching a second location until you know you can do it successfully.
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