Why You Need a Market Entry Strategy
Setting up your business in a new market is a hugely exciting time for many organisations, but it can be a very complex process. This is particularly true if you’re entering a foreign market, as you may be up against a wider set of challenges. However, by working with the right consultancy firm, you could have access to expert insights and support along the way. Here, CEE Sourcing takes a closer look at entering a new market and why you need a market entry strategy.
Reasons why you might enter a new market
There are a whole host of reasons why a business might enter a new market, but it’s mostly to do with gaining even more success in different countries or regions. Expanding your business to a foreign market can help you tap into a new customer base, which in turn can increase the business’ potential revenue.
Entering a new market can also be beneficial in diversifying your market, so the revenue is more stable. This means that if one area of the business were to fail, there are other areas to rely on. You can also open up your business to a greater talent pool, allowing you to employ people in different regions or countries and tap into their skills and knowledge.
Together, these reasons could give you a significant competitive advantage, providing your market entry strategy is solid.
What is a market entry strategy?
The process of entering a new market can be challenging, so it’s important to have as much information to hand before you begin. A market entry strategy will help you to determine by what means you will set up your business, as well as identifying the successes and risks that may come with it.
Some of these risks can include things like political unrest, currency exchange and cultural differences, all of which may play a part if you open a business in a foreign market. A market entry strategy can help you to identify these problems early and give you a chance to mitigate the risk.
Essentially a market entry strategy provides a clearly defined plan to help you determine the business model or framework, to give your business the best possible start. It can also help you to decide what technology and resources you need to achieve successful market entry, including any outsourcing.
The benefits of having a market entry strategy
As soon as you start thinking about expanding to a new market, your strategy will begin with the necessary research to decide on your next step, and which market is best. It’s important to have an idea of the scope, timeline and budget before you put anything into action, and this is why making a strategy early on can be beneficial.
A strategy of this kind will provide you with the full picture of the market you’re entering, with thorough research and analysis so there are no surprises. It also delivers an insight to your business’ potential success, including its readiness for the chosen market, and gives chance for you to improve anything before market entry occurs.
Your market entry strategy can also make you aware of any government or legal regulations and compliance when operating in a new country, so that you can avoid any wrongdoing.
You can work with a business consultant to help you navigate the challenges of market entry. They are equipped to help you come up with a suitable strategy and ensure it is executed to a high standard, as well as offering ongoing support as your business progresses in its new market.