Growing Up With The Best Business Expansion Plans
What is a Business expansion plan?
A Business expansion plan is a roadmap that defines the strategy that a company must follow to achieve well-established growth objectives and includes aspects such as:
- Plan features and measures appropriate to business needs.
- Feasibility analysis of the procedures should be performed.
- Framework in which its development must be carried out.
Growing up is the goal of any company
Therefore, if your business is already running and is profitable, perhaps you have begun to consider its expansion. To avoid taking unnecessary risks, ideally, you should have detailed planning of how you are going to achieve this growth. This is what is known as a Business expansion plan, a document that, in addition to analyzing the company’s potential development, also includes an assessment of its viability. If you want to make a good expansion plan that allows your company to make the jump to new markets successfully, keep these keys in mind:
Choose the best expansion strategy
When you consider going one step further with your business, you have four ways to do it:
- Market penetration: greater consumption of current products is pursued in current markets.
- Product development: it is about offering new products in the markets in which the company currently operates.
- Market development: it consists of offering current products in new markets, increasing the public and, therefore, potential customers. You can choose to approach new audiences or sectors or for geographic expansion.
- Diversification: the company concentrates its efforts on the development of new products in new markets. It is the riskiest expansion strategy.
To develop your business expansion plan, you have to be clear about what strategy you will follow and, from there, work to carry it out, taking into account all the resources you will need in the process. In this scenario, many companies are betting on the conquest of foreign markets as an expansion strategy. And is that internationalization is not only a way for the growth of your company, but also for its integration and diversification.
Your expansion plan should include an executive summary of your company, with a general presentation of it, which describes its business model and objectives, as well as functional aspects such as how many employees it has, how it is organized, what type of products and services it offers. How you work on a daily basis… You should also point out the reasons for the expansion and the chosen growth strategy, as well as general information about the project.
In the event that you are going to make the leap to foreign markets, this information will be very useful for you to evaluate the export capacity of your company and with what structure and resources it has to face the international adventure.
What are the strengths of your business?
Before facing any growth strategy, it is very positive to know the advantages of your company compared to the competition, as well as all those factors that have made it a profitable and stable company. Surely, it will not be a single issue, but all of them should be reflected in the expansion plan. For example:
- An analysis of the products or services that have enabled the success of your company.
- Its advantages over the competition, that is, those characteristics that make your business unique in its sector.
- Those business goals and successes that have been achieved since its inception.
- Information about your management team: people are the ones who do business, so you must emphasize the advantages that your company has in this regard. Make a detailed presentation on who they are, what their training is, and their skills or achievements within the company.
Market description and research
The expansion plan must consider what type of market the company is going to operate in, what difficulties you may encounter, or what is the best way to sell in it. And what better way to find out than by doing a study of it, including a description of demographic variables and an analysis of the competition.
For this, there is no single answer and it is best that you base your decision on objective data and analysis of potential markets. At this point, prioritization is another aspect that you must take into account when exporting. Focus the effort on one or two markets and plan their internationalization. Once consolidated, you can go to new countries.
Goals for Business Expansion
Having a clear objective helps to know where the company should go and how to achieve it, without forgetting that, later, it will serve to measure results. The expansion plan must include all those goals that are expected to be achieved both for business growth and in the different departments. Even at the individual level, thus achieving the involvement of all those who are part of the company.
Development Of The Action Plan
Knowing the situation of your company and the objectives, it is time to describe the different actions that will be carried out to carry out this expansion, whether international or otherwise. It is time to analyze those tools that your company will use to achieve the stated objectives, such as the hiring of personnel for new departments or activities (if applicable), the expansion or modification of the company’s facilities or the acquisition of new machinery or tools. In this sense, your expansion plan should include financial, investment or marketing details, which will include the following documents:
- Investment and expense plan: this section should include those expenses that are expected to be carried out in the next two or three years as a consequence of the expansion. whether they are on the purchase of new machinery, the expansion of personnel equipment, the opening of new facilities, Research and study of the new market, promotional material or advertising and public relations expenses.
- Financial plan: necessary to be able to develop the investment plan and which includes the forecast of capital needs to carry out the expansion of the company.
In the case of an international expansion, this financing plan will also consider aspects such as the tax rates of the country to which you are going to export or the possible incentives that may exist when settling in a region. Marketing plan: it will collect all the information related to the product, price, promotion and distribution that will be necessary to achieve your expansion objective. At this point, you must plan how you will sell your products in the foreign market, for which you must take into account the barriers that language or cultural differences can cause.
A good presentation
This is a must. The expansion plan is not a document that will later be forgotten in any drawer. On the contrary. For you and for all the members of your company, the expansion plan will be like a memory that will remind you of everything achieved to date and will serve as a guide to carry out the expansion of the business from a firm base and following the established guidelines.
In addition, it should not be forgotten that the expansion plan is the document that, when looking for resources in the market, you will present to potential investors, banks, or other companies with whom you are looking for a collaboration. Likewise, it offers you different services for your international business, ranging from giving you money for your projects or helping you with currency exchanges to connecting with a wide network of professionals. The goal is none other than to help all businesses eliminate borders.
Once the Business expansion plan has been drawn up, all you have to do is work to conquer new markets. Follow it step by step because facing these new challenges can bring you great rewards. And for your international strategy to be a success, some last tips that you should not forget:
- Adapt to the new market: The products, services, business processes and documentation not only have to be in the target market language, but also adapted to its values, culture and needs.
- Find out the country’s regulations: it is essential that you know if the legislation of the new market, to see if it is adequate for your expansion plans. You must take into account the tax laws, customs regulations, import restrictions, without forgetting other types of aspects such as payment methods, foreign exchange or transport.
- Preparation and training: Train your team with specialized export or foreign trade courses to acquire extra global knowledge, achieving greater involvement of all human resources. In this sense, at Santander Trade Webinars you can access online seminars taught by the best experts focused on training and connecting companies from different countries.
- Think long term. The conquest of a new market does not come overnight, it requires time and, therefore, also patience, flexibility and the ability to listen to your new audience.