5 Different Types Of Business Expansion
If you’re thinking of expanding your business, you’re probably thinking about how to do it. There are many ways to approach this, and different options will be suitable for different businesses. Here are five of the very best ideas to consider though.
If you can find a company that you have a crossover with, you could build a collaboration. Of course, you don’t want to collaborate with rivals who sell the same products. But a company that sells something that is complementary to something you sell could be the ideal partner to collaborate with. You can start a joint campaign that aims to reach customers. They could then gain access to some of your customers, and you could gain access to some of theirs. It’s mutually beneficial.
Franchising is one way of growing your business without doing too much of the work. When you franchise your brand and idea, you let other people open a branch of your business in another location. They use your intellectual property, and then you get a significant cut of any money they make. The good thing about this is that the franchisee is the one who takes on the risk, not you. So, if things don’t work out at their branch, then this doesn’t need to affect your entire business.
- Organic Growth
Organic growth is the kind of growth that happens naturally and gradually in successful businesses. For example, a business can grow by slowly reinvesting profits to create more products. This can help to complement the existing range of things that the business offers to its customers. Organic growth happens slowly over time, and that’s what makes it a safe option for many small businesses. It’s not about rushing into new endeavours that present big risks for the business. This only takes a business so far though. Bigger expansion plans might be necessary in the future.
- International Markets
Entering international markets is a good way of finding more people to sell to. If you think that your business has reached its full potential already, taking the business to new territories might be your only option. It’s certainly a challenging undertaking though. You will have to think about how you take care of practical issues like the transportation of goods. Transportation logistics have to be solid, thought through and well managed if you’re going to sell products in new countries. If you manage to do it though, the financial rewards can be huge.
- Mergers and Acquisitions
Buying another business and using it to expand your current business is known as an acquisition or merger. This allows the business to use the assets and intellectual property of that company. Some companies will then incorporate the newly purchased business into its existing business model. This is a great way of a business enabling itself to enter a new market and reach an entirely new sector of the market. It takes a considerable amount of money to make this happen though.