Seeing as the purpose of expanding your business is to make more profits, you should regularly review the investment return from a business expansion. As well, you should have a defined reason to expand, such as to enter into fresh, potentially lucrative market segments. Previous Next. View Larger Image. Advantages of Business Expansion As the owner of a small business or startup, you may aspire to expand your company.
New team members One of the biggest advantages of expanding is the opportunity to hire newly qualified team members. Wider customer base Business expansion has the potential to expose your products and services to a broader audience.
Funding opportunities Successfully expanding your business can put it in a positive position for gaining necessary funds. Potential relocation Expansion may present you with the chance to relocate your business to another area, across the state, or even internationally.
This quarter, the company reported increased sales in China, India and South Korea, which benefited Coca-Cola worldwide.
Coca-Cola also recently bought Mexican sparkling water brand Topo Chico in an effort to grow a more globally attractive and diverse portfolio. Another top benefit of going global is the opportunity to access to new talent pools. In many cases, international labor can offer companies unique advantages in terms of increased productivity, advanced language skills, diverse educational backgrounds and more.
In addition, international talent may also improve innovation output within a company. Companies also choose international expansion to gain a competitive edge over their opponents.
For example, businesses that expand in markets where their competitors do not operate often have a first-mover advantage, which allows for them to build strong brand awareness with consumers before their competitors.
International expansion can also help companies acquire access to new technologies and industry ecosystems, which may significantly improve their operations. They do not infringe on any copyright design. So, you have survived the first couple of years of starting up your business and now your attention turns to expanding what you have started.
Successful leaders know that their company needs to expand in order to increase profits and reach new customers. There are many ways to achieve this and they all present a new set of challenges and risks. You can do one or all depending on your business and the risks your willing to take. According to the Ansoff Matrix, there are four strategies to grow your company, each with a different level of risk. Market penetration is the safest course to take because you already know the products and the market that you will be targeting.
Selling more products to an exciting customer, finding new customers within these markets or widening the range of exciting products requires little research and risk, but can it achieve your businesses growth objectives. Lowering prices to compete with competitors may not work for everyone like it has done for Walmart and Costco. Apple uses aggressive marketing campaigns for selling more iPhones and iPads to their current market.
According to Panmore Institute, Market penetration is Apples second most intensive strategy for growth. Product development is a little riskier as it is uncertain how the market will take to it. Insights into the needs of the customer are imperative as well as successful innovation. Coca-Cola launched Coke Light in , a low calorie and low sugar alternative.
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