Expansion Strategies for Your Business- Get Growing!
When it comes to a business you must never rest on your laurels but must be use your creative side to come up with expansion strategies. Some examples of ways to do this include introducing a new product, market development, product licensing, to begin a chain and to consider a merger or acquisition. Growth is important but make sure you don’t become too enthusiastic and overdo a good thing. Overdoing can be just as detrimental as under doing. How Do You Grow Your Business?
New Product Use your creative side to come up with a new product that is in line with what you are already selling. You do not want to introduce something old or outdated but you never know when you might hit upon an excellent idea. Extending the product line you already have is a good idea but introduce new products slowly. You do not want to overwhelm your customers. Do not create a whole new product that is unrelated to what you currently sell. You will more than likely money from your existing customers than you will from the new customers you acquire due to your new product. It is the Pareto Principle or the 80/20 rule (sometimes written 80:20) at work.
The 80/20 Rule states that 80% of your regular business will come by way of 20% of your long term loyal customers. It is always good to look for ways to get new customers as all loyal customers were once new customers but it costs five times more to get a new customer than to hold onto one that you already have.
Market Development
Developing your market using innovative new designs or concepts is a smart idea but do not exceed beyond your reach. This can overstress yourself, your employees and can overload the system. Worst of all if you overspend on your budget your company
Product Licensing
Licensing your product carries some risks in a financial sense because the onus of responsibility for the success of the product shifts from the creator to the company that is going to market, advertise, produce and distribute it. While you may lose out on profits in the short term, if the product becomes a bestseller and garnishes a national reputation for quality, you will reap the rewards in the end.
Begin a Chain
Certain businesses are easy to replicate in other locations and turn into a chain. Examples of these include restaurants, bars, retail stores and a variety of service businesses. It is essential to figure out why your original store worked in the first place and what traits can easily transfer to a new store and which cannot. You have to pinpoint if your initial success has to do with your products or services, your location, yourself, your staff or your marketing campaign. You start a new marketing campaign every time you open at a new location to drum up new business.
Merger or Acquisition
Joining forces with another company can make both of your companies bigger and better and can make you shine twice as bright! By doing this you expand your quantity of customers, you will operation more efficiently because you have more people to do the work, and you will increase your capital. It is vital that you find a partner who wants the same things as you do from his or her business however. Vision is extremely important or you could end up with conflicts and rising tension that threatens to destroy the good work you have both done.
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Ideawala.com is a business social network for business ideas - big or small; bricks or clicks; services or manufacturing. Various business ideas are submitted by you peers and/or professionals and are voted by you.
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