Strategies for Penetrating New Markets

More locations – Perhaps, your company could benefit from opening more stores, warehouses or factory locations to bring you closer to new market opportunities. This is a common strategy used by small business retailers that have captured the available market in one location and seek to duplicate their success in another neighbourhood or another region. Some ways to do this are:

  • Minimise overhead – Rather than reproduce your whole operation at a new location, keep the head office at the old location and only reproduce the essential warehousing, production, or selling functions needed to operate a skeleton facility at the new location.
  • Use temporary locations – If feasible, test out your new location by erecting a temporary presence, such as by using a stall, kiosk or portable trailer. Temporary office space could be rented before securing a long term lease or some staff could work from home.
  • Expand existing space – Do not overlook the possibility of simply taking over neighbourhood space or land and growing larger at your current location. Get to know the terms of neighbouring leases and know when they expire so you can negotiate with the landlord in advance. Such expansion maximises economies of scale at your current location for rent, insurance, utilities, and staffing. The savings could fund larger refurbishment of the current location and increase your ability to draw customers in.

Internationalisation – In the past, many small businesses were often slow to seek out export markets and international buyers. This was understandable: foreign languages, cultural differences, tariff barriers, slow communications and other hindrances created real and perpetual barriers to international trade. But in the last decade, the proliferation of English, the emergence of inexpensive telecommunications technology and the spread of free trade practices have opened overseas markets tremendously to small business.

© 2009 "Start Small, Grow Big" Barbara Mowat and Ted James, with the contribution of William Erichson on Chapter 6, "Financing A Growing Business". All rights reserved. Reproduced with permission. No part of this work may be reproduced, distributed, amended, modified, edited, transmitted in any form, or translated in any way without the prior written permission of the copyright owners. www.ImpactCommunicationsLtd.com.

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