You will probably also be able to get better credit terms with your suppliers. One more advantage you will have is that you can swap products between your business locations. If you have products that are not selling well in one location, you can send them to another, in the hope that they might sell well in another area. If sales at one location have weakened or slowed down for some reason, your other locations can help your bottom line by keeping the money flowing.
This will help your business survive the rough patches until things pick up again. More stores means more respectability and publicity for your small business, and your brand name will build up as you expand. This will pull in additional business. Expanding your business is a risk that may have big payoffs but that would require a lot of sacrifice on your end. If you are willing and ready, work hard and keep your eye on the prize! Consultants can also use this wage calculator to convert hourly rate into annual income.
This free loan calculator is a great tool for your business. Compute your loan payments at different payment intervals and create an amortization schedule for your business.
Download this free pre-written MSP marketing plan template for proven month-by-month steps to generate qualified IT leads. Editable Microsoft Word format. The Advantages of Geographically Expanding Your Small Business If your small business is even mildly successful, then it makes sense to expand to other neighborhoods, counties or states.
If PMG had not uncovered this critical finding in our research or if the client had elected not to investigate the Brazilian pool market before expanding, the cost of failure would have far exceeded the cost of the research project. By continuing to use this website, you consent to the use of cookies in accordance with our Cookie Policy.
Skip to content Priority Metrics Group. As our research progressed, we found other critical market dynamics that confirmed Brazil was likely a good candidate for geographic expansion, including: Favorable Trade Status a preferential customs tariff between the US and Brazil no tariff quotas of any kind in place on this type of pool equipment, Attractive Market Size and Growth the current installed base of pools exceeded 2. Really appreciate you sharing this blog post. Really thank you!
Keep writing. Current Industrial Reports U. Census Bureau. CIRs provide information on production, shipping, inventories, consumption, and the number of manufacturing firms for over products. Economic Censuses.
Census Bureau, every fifth year. The Economic Censuses report sales figures and trends. County Business Patterns U. Local industry statistics.
Encyclopedia of Associations Gale Research, annual. Lists U. The staff should be able to provide you with information on regional growth trends and competitors. Now list the sources you are going to use to get the market research information that you need. Key Questions to Answer Your research should help you decide whether or not it will be profitable for you to enter into the new target market. Refer to your customer profile as you do your analysis to help you stay focused on your customers and their needs.
Try to determine if your new target market is growing, stable or declining. You may be able to compete successfully for a good market share now, but if the market trend shows declining demand for your products or services, then the future may not be promising. It is better to enter into a market that shows healthy growth trends.
For example: The owner of the Pedal Power bicycle shop believed that he could compete successfully in the targeted area since none of the bicycle shops in the areas offered mail order service. He estimated that with his purchasing incentives, such as the earned credit plan, and his low prices, his mail order catalog could capture at least 10 percent of the market share in this area. Capturing this market share would increase his annual sales by 40 percent. What are the trends for your market? Can I compete successfully in this new market?
Decide whether the market is large enough to make it worth your while. Analyze all your trend data carefully before you answer this very important question. Is the market already saturated with competitors or is there room for one more? What is the relative strength of your competition? Do you already compete with them in other markets? Also, supplement this information with your own experience and knowledge. If you are successful in your current markets, then you probably already know a great deal about what it takes to sell your product.
You should be able to identify some unique features and benefits of your products or services and the way you promote them. Remember, features are the special characteristics of your product or service, but it is the benefits that sell a customer on your product or service.
The customer wants benefits; they satisfy his needs. For instance, you may sell an air-conditioner that is efficient, is computer-controlled, has few moving parts, and is economical. The customer, however, buys it because it saves money on his electric bill, is easy to use, is quiet, and affordable — all benefits to him. Think about your prospective competitors. How are they likely to react if you enter the market? Are your product or service benefits strong enough to compete against theirs?
What will my market share be? Try to estimate the market share you hope to gain and the amount of time it will take you to gain it. Most business owners overestimate their expected market share so start conservatively. You may want to conduct some limited-scale test marketing in the area you are targeting. Promote your service. Test the waters. Find out what the response will be and base your estimate on that trial.
What is your market share projection? Can I make a decent profit? Consider pricing and profitability. Can you sell your products at a competitive price and still make a profit in this new market? But how can your costs be higher for this new market? Your promotional costs will be greater. Your distribution costs could be higher. Your labor costs may increase, etc.
Estimate the numbers for the following abbreviated profit and loss statement also known as an income statement to get started on your analysis. Does it make financial sense to enter the market? After you have completed your market research, analyze the information you have gathered to determine whether market expansion into this particular market is the right decision. The owner of Pedal Power bicycle shop decided to target a tri-state area.
This area contained several large cities. Since readily available demographic information about bicyclists is limited, the owner decided to purchase a mailing list for the targeted area from a marketing research firm. The mailing list consisted of people who subscribe to magazines that deal with bicycling, running or other outdoor activities. The market research company was also able to provide the owner with information on growth trends for bicyclists in the target area. The information indicated that the increasing popularity of bicycling was resulting in a steady growth in bicycle-related sales.
The number of bicyclists in the target area was also growing at a healthy rate. To determine the number of competitors in the target area, the owner contacted the chambers of commerce for each of the major cities. He discovered that there were 17 bicycle shops in the tri-state area. None of these shops offered a mail-order service.
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