Business expansion is a major challenge. There are barriers both inside and outside the company, such as a lack of communication and intense market competition. To overcome these and other bottlenecks, managers need to understand best practices.
In short, expansion involves finding new customer contact points, entering new markets, and integrating new items into the product mixBut you need to be careful, as small mistakes can be costly and lead to business failure.
We've created this article with the best practices you need to adopt to expand your iron and steel store. Read on to learn more.
The first (and easiest) tip is to expand the product mix you offer. The greater the variety, the easier it will be to meet market demands and close profitable sales. Therefore, evaluate which items can be integrated into your portfolio.
However, you need to be careful: introducing products with little sales potential is the same as leaving money idle. Research the market's needs, find a good supplier and close deals with attractive margins for your store.
A common expansion model is through the opening of new business units—or branches, as you prefer to call them. In this case, the store opens new outlets to serve other markets, usually far from the parent store.
The challenge is to make the new unit profitable, because if it is not, it will consume the financial resources of the parent company and generate little return on investment (ROI). Therefore, it is necessary to have a plan to make the new unit self-sustainable within 1 year.
One measure that involves lower costs and risks is franchising the brand. In this case, other units will be opened under the franchise model, with a license to operate under the business's brand, and must pay royalties for this advantage.
However, to franchise, you need to pay attention to a few points: the matrix must be the business model and operate with accuracy and quality; the business model must offer a real return (ROI) to the franchisee, otherwise the expansion will not be sustainable; and the support of lawyers and experts in the field is crucial.
The internet is a wide-open space for business. It's possible to sell to a wide range of regions, both domestically and internationally. This depends on a solid strategy and an attractive brand positioning in the digital world. aligned with customers.
To start online operations, you need an e-commerce platform. In this case, the manager can create their own website or rely on marketplaces (a space that houses several virtual stores).
You can choose one, two, or more of these strategies simultaneously. However, first and foremost, you need a good plan. Without planning, expansion can generate significant losses, affecting profits and business growth.
Therefore, start with an internal and external analysis and answer the following question: Is it the right time to expand? If so, establish the objectives and goals for expansion (e.g., increasing market share), then define how these results will be achieved.
Business expansion is a big challenge. You need to have a good plan, maintain the team aligned, rely on good suppliers, and choose the best strategy. This will help you grow, stand out from the competition, and generate greater customer satisfaction.
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