A small company will need to plan carefully when using a diversification growth strategy.
But, you must be cognizant of what made the first location a success - was it location, your staff or you? If it is just you, then duplication is only possible through detailed operations plans and sharing staff between locations. You will need to duplicate the plan of your first location while meeting increased customer demands.
Starting a chain gives your current staff a crack at "management" duties, training opportunities and an opportunity to expand their horizons.
You will need to be a good teacher, be able to prepare the training manuals preferably in more than one language , be very organized and willing to travel.
Licensing can carry less risk, but demands giving up a certain amount of control. Licensing a patent, trademark or industrial design means that you sell manufacturing, distribution or production rights. A merger or acquisition combines the best of two companies, expands your customer base, increases intellectual capital and delivers operational efficiencies.
The trick is finding the right partner. These partners may be new distributors, but be forewarned large retailers exact heavy performance expectations. Can you perform to the letter of your promise? Can you meet high standards of quality ISO, or the like and adapt your procedures to meet just-in-time delivery? Due diligence and strong contractual arrangements are essential here. You can decide to go global in a number of ways. Growing markets, rising consumer spending, improved business climate--sometimes the only place to find these things is overseas.
Doing business internationally can take the form of exporting, licensing, a joint venture or manufacturing, but whatever form you choose, the basic business rules apply: More difficult to understand than the regular business affairs may be the cultural nuances - ignore them at your peril.
In some countries, particularly those in Asia, a local partner is virtually a requirement. Your first stop should be your target country's economic development agency, which can help marshal local resources to get you on your way, possibly with a small financial boost. One growth strategy in business is market penetration.
A small company uses a market penetration strategy when it decides to market existing products within the same market it has been using. The only way to grow using existing products and markets is to increase market share, according to small business experts. Market share is the percent of unit and dollar sales a company holds within a certain market vs. One way to increase market share is by lowering prices. For example, in markets where there is little differentiation among products, a lower price may help a company increase its share of the market.
A market expansion growth strategy, often called market development, entails selling current products in a new market. There several reasons why a company may consider a market expansion strategy. First, the competition may be such that there is no room for growth within the current market.
If a business does not find new markets for its products, it cannot increase sales or profits. A small company may also use a market expansion strategy if it finds new uses for its product. For example, a small soap distributor that sells to retail stores may discover that factory workers also use its product.
A small company may also expand its product line or add new features to increase its sales and profits. In addition, your product will have to be certified as safe [by those countries' standards]," he wrote. In America, the business world moves quickly. You have to be patient and prepared for multiple interactions to build trust. While some big-name U. If you do, can you be profitable under the circumstances? If you feel you're ready to tackle the challenges of international business, follow this advice from business leaders who have been in your shoes.
If you plan on expanding globally, you'll want a great team and partner. Even if your "partner" is in the form of a mentor, you'll want someone you trust and who can vouch for you. The people you hire to deal with your overseas business partners and customers must be fully immersed in the local environment but should also be looking out for your interests. Instead of only thinking about how your own country's customers might receive your new ideas, you'll need to think about how foreign customers will receive your ideas.
If you don't do this ahead of time, you run the risk of offending your international partners by appearing to be more concerned about yourself [than] them. Varying cultural norms and customer needs in foreign countries may require you to adjust your sales approach, or even your whole product.
Rogers noted that while you should stay true to your overall brand, it's important to tweak your product offerings to account for local tastes.
If you can maintain quality, local sourcing has the opportunity to improve cost margins and supply-chain reliability. Before making major business decisions, you should think through all possible scenarios — especially during international expansion.
An international expansion strategy comprises market entry strategy including crucial choices in regard to primary markets of focus, determination of target customer and channel strategy, resource allocation, product and service value offerings, brand positioning, and creation of an operating model. For this reason, Michael Lee, head of international marketing and business development for ecommerce platform fishingrodde.cf, recommended looking for markets that are similar to . International Expansion is a guide to international business expansion tips and training courses from around the world. Although started in Chicago, this site receives contributions from our global representatives in Oslo, Manila, Shanghai, and from time to time, from many other locations.