Business expansion and growth are key goals for any entrepreneur. Since these goals require huge investments in terms of both human and financial resources, they pose a great risk to the business. In order to successfully steer your business through the unknown waters of expansion, you need to be aware of the risks you will face as well as how to properly manage them.
Here are some tips that can give your business a better chance of growing and expanding to the next level:
• Know where you are headed. Before embarking on business expansion, it is imperative to have a clear vision of where you want to go and the goals you want to achieve. This will act as a rudder for your business. Take the example of Stephen Wynn, who built The Mirage Hotel in Las Vegas. Armed with nothing more than a vision and confidence, he staked his reputation on building a hotel that was considered a high-risk venture at the time. However, he managed to bring together resources to build his dream and went on to play a role in the resurgence of the Las Vegas strip, stamping his name in the history books.
• Do your research. To conquer new markets, you need to conduct intensive market research. This will help you uncover your customers’ demographics, preferences and spending power, enabling you to give them tailored products and services. Market research also allows you to learn your competitors’ habits and how you can get an edge over them in the market.
• Develop a solid strategy. After conducting research, you should develop an expansion strategy. You need to decide whether to stay in your current market and expand through introducing new products or services in your business portfolio or penetrate new markets. Using the latter strategy, you will market and sell your existing services/products to new customers in a different territory. Take your time to learn the pros and cons of each strategy, and then go with the one that you feel will be most profitable.
• Tap into new sales and delivery channels. The internet has provided countless businesses with a cost-effective sales and delivery channel. Learn how you can use it to your advantage either through opening an online store, launching a website or developing a mobile app for your business. This will give you instant feedback from your customers, helping you to improve your services.
Expanding and growing your business undoubtedly comes with many risks. Consider how you can use these tips to give your business the best chance of success as it grows.