S3 Blog

Markets in economic terms are defined as any infrastructures, systems and procedures in which buyers and sellers exchange services, information or goods – when money is exchanged for any of these it is known as a transaction. When you have a business it can be a huge benefit if you can successfully expand into new markets as this can bring increased revenue and raise the profile of the business – if you get it right. Get it wrong and you could run the risk of losing a great deal of money, something which should be avoided at all costs.

With this in mind it is important that when you are expanding into new markets you have thought about all possibilities and done as much research on the market you will be expanding into as possible. Before any expansion can begin you need to decide how you want your business to expand into new markets – are you looking to expand geographically or do you want to aim for target market expansion, where you offer a new product or service?

There are advantages and disadvantages to both types of expansion, for instance if you choose to expand geographically you have an advantage in the fact that you already know and are comfortable in your current market. So in theory expanding into a new geographical market should not present you too many problems. However one of the cons to this type of expansion is that the product or service that you sell might not be suitable for a different geographical market, so do plenty of research beforehand and make sure that expansion in this way is the right choice for you and your business.

If you are looking towards target market expansion you need to decide what market you will be targeting, for instance if you already sell a type of drink that is aimed at adults why not think about selling one that is aimed at children? This way you can get a larger portion of the drink buying market as you are targeting a market that is made up of both adults and children, yet you are still comfortable trading in a similar market to your original one.

Regardless of which way you plan to expand into a new market there are a few things that you should bear in mind. To begin with start off slowly, don’t plough too much money that you can’t afford to lose into your expansion. That way if things go wrong you are not risking too much financially. You should also make sure that you have done plenty of market research to see if expanding into a certain new market is a viable option for you, if not forget about it and concentrate on a different market that would be more profitable. It is also wise to make sure that you have a business plan to work to that way you will know what you want your expansion to achieve and how you are going to make sure that happens.