Design and Implement the Right Strategy for Your Expansion Process

Expansion Process

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What is the essence of a business without growth and expansion? For every start-up, there is always a reason and plan to know the right time for expansion. You don’t just consider expanding your business without indicators that give the green light.

Plans and strategies are the prerequisites for business expansion; without them, then such business will be categorized as another failed business. With careful implementation, the expansion will be a great way of investing in sales of the current products and services.

Also, it is incumbent on you to take your time so you can minimize risk and maximize profit; learning about the business expansion can set your foot on the right track.

Why Expand Your Business?

Going by the definition, business expansion is a strategic process that involves selling your current products and services in a new market when that apex has been reached with the existing sales channels. For instance, if a business selling socks succeeds in selling its socks in a new market when it has reached the apex with its existing market, then we can say such a business has successfully expanded its business.

The criteria for business expansion is to fulfill all existing markets before moving to other markets.

From the definition, you can fully deduce why you need to expand your business; to reach a new market and maximize profit.

How To Design And Implement Strategies For Growth

1. Start With An Overview

It is safe to say without an overview, the business expansion might not be possible because the overview will serve as a blueprint of your expansion plans.

The overview will make you know the exact time to expand; most business owners see an increase in sales as a perfect time to expand, which might not be true. So many factors contribute to the increase in sales. It might be a festive period or whatever reason that could spike sales for a short period.

An overview will guide you to determine the true indicators so you don’t miss things by expanding when you still need to focus on the present market.

2. Have A Financial Getaway

The primary objective of business expansion is to maximize profit, which can only be possible when you have enough financial capability. You make money with money; you need money to begin a start-up whose sole aim is to make money by solving people’s problems.

Also, when planning your business expansion, you need to have a financial plan to help your new business support itself financially so you can get back your initial capital in no time.

3. Create New Channels

After you must have gotten all the green light for business expansion, such as customers’ requests, increased sales for over 3 months, and increased demands for your products and services, then it’s time for the big move. The next thing to think about is what new channel should I explore for my business expansion. Should I open a new branch or a new subsidiary? Let’s talk about branch vs subsidiary.

Benefits Of A Branch And A Subsidiary

When you opt to open a new branch, you have full access and control over the branch, and as such, the branch is subjected to the same law guiding the parent company.

While owning a subsidiary will make your market share grow since it will act independently. Also, the subsidiary is at liberty of establishing its modus operandi to fit in any location it desires to target.

Difference Between Branch And Subsidiary

For a branch, your business as the parent company will need to invest 100 percent in opening a new branch. In contrast, you need just half of that to open a subsidiary since another individual will most likely run the subsidiary with a different legal standing.

You have full control over the new branch, and they will be reporting all activities to you as the business headquarters, while the subsidiary can either report to you or to the subsidiary holder who has a share.

4. Keep Building Your Brand

Expanding into a new market doesn’t mean you need to stop building your brand. Of course, you now have new market targets and new plans, so you need to keep your brand afloat; repeat all the methods you used in making your parent company successful to all new branches to target new markets.

Conclusion

Business expansion is as challenging as starting a new business; you need to plan ahead, develop a plan B in case the initial plan fails, and also be consistent to keep the boat sailing.

When you implement the right strategies for your business growth, then your business will adapt to any new environment you are established in swiftly.

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