Businesses are built to grow; you must always strive to expand market potential, increase revenue, and deliver key strategies of your annual plan. When looking for opportunity to increase both your company influence and profit goals, you must first do a thorough analysis of your current position in the market. Understanding your position will help you better prepare to scale. Companies typically develop growth strategies based on four standard models:
Product Development – Offering new products to current customers encourages loyalty, increasing the lifetime value of any current or former customer. You may also attract a secondary market from early adopting customers of a different niche.
Expanding Current Markets – Many business first focus on gaining a larger market share. Before you’re in a position to expand to new markets or diversify products, you must establish yourself as an industry leader, owning most of the current potential market.
Targeting New Markets – Taking an existing product into a new market extends the life cycle and adds value to a customer base which you identify as under-served. You can target new customer profiles domestically or export your products to a similar market in another country.
Diversification – By combining product development with new market penetration, you can diversify brand identity. You can choose to target more affluent customers with innovative product lines, or reach a mass audience by providing a cheaper alternative to your current offerings.
Business tend to take these steps when they’ve exhausted their current market potential. A fear of stagnation pushes them forward when they are capable of handling the operational expansion. Aside from these standard growth models, you can achieve results with less risky moves, such as:
Expanding Platforms – Delight existing customers or find new ones by selling on a different platforms. You can add new retailers to your distribution network, find third party online wholesalers or retailers, or look to sell on platforms only utilized in another country.
Leverage Partnerships – Partners help you move products forward. Both you and the partner can share customers, or can introduce you to exclusive talent and resources. Solid partnerships allow you to expand and target new markets.
If your company is looking to expand physically as well as strategically, you should also consider acquisition. There are three major ways to succeed in business acquisitions without bottoming out:
Horizontal Acquisition – Buy competitors, or complementary businesses. This is the simplest way to diversify. You can also make a move towards dominating the current market.
Vertical Negative Acquisition – Buy companies that work in your internal operations, such as distributors and developers.
Vertical Positive Acquisition – Buy retailers and other selling platforms to control your products’ placement, and gain leverage in distribution.
Contact the experts at Baysource Global. We can analyse your current business model and modify it to meet the demands for a Chinese market. Learn how our professional team helps businesses like yours transfer operations overseas, in a smooth transition. Baysource Global is one of the few U.S. manufacturing and distribution outsource businesses with the right connections and qualifications to move you forward. Connect with us for questions.