Question

Describe the Strategies for Entering New Businesses.

Answer 1

Entering into new businesses or choosing different sectors to grow our business is an effective way to reach to potential to growth opportunities. Every businessman should focus on growing its business by introducing new products or services and entering a new market by targeting new customers. It is not easy to choose a new business or product line as it needs to analyze and study various strategies about the new markets and businesses. It is possible for the company understands the current market and might be possible that it is growing in the current business.  

There are various strategies that a business need to follow before entering into new businesses or market that we will discuss in below points:

a. Define the Products or Market:

Before entering into a new business or market, the company needs to identify the new product that it wants to introduce in the current market or new market that it wants to enter. It is one of the crucial tasks for the organization. The organization needs to understand the needs of the market and customers and should develop the product or service as per their demand.

b. Market Analysis:

Market analysis is an important task and activity that an organization needs to take care of before finalizing the market that would be beneficial for the new product or services. The market should have demand for that product and have enough customers who would be happy to buy the products. The organization should have done the market research to find the target market. Market research should include market growth rates, competitors analysis, forecasted demand, entry barriers, etc.

c. Analyzing Internal Capabilities:

The organization also needs to analyze its internal capabilities before entering the new market. Building a new product or entering a new market needs various resources such as capital, manpower, technology, a well-defined supply chain, etc. The organization should have full support in terms of these mentioned factors. The organization needs to analyze its core competencies and also the price factor that it will introduce a new product or into a new market. The organization needs to have well-defined strategies for infrastructure and technologies that it will use for developing a new product.

d. Make Priorities and Market Selection:

After having results of the market analysis and internal capabilities of the organization, it is the time to prepare lists of various markets and list them as per the priorities. The market should be prioritized as per the product fit and ability to serve it by the organization. In the end, by using various techniques and method, the organization need to finalize the market that it wants to enter or introduce a new product into it with clear and defined strategies of the supply chain, vendors or suppliers, technologies, operation, and marketing.

e. Choose Appropriate Market Entry Option:

It the last step to follow by the organization to choose the appropriate market entry options that would be feasible and optimal for the organization. There are various strategies that would be useful for the organization to choose from, such as retail, wholesale, merger or acquisition, direct selling, online selling. After selecting the right entry option, the organization needs to prepare for the required infrastructure and supply chain strategy. Apart from these strategies, the organziation need to prepare business plan, implementation plan, investment plan, marketing plan etc to introduce a new product into the current market or choose a new market for the product or service.