Start-ups have been sprouting all over New Zealand as the ease of doing business in the country is the highest among 190 world economies. Start-ups find it easier to set business here than anywhere else in the world. The productive environment and stable socio-economic conditions have encouraged entrepreneurs to step up their game.
The government is also pushing for $300 million Venture Capital Funds Bill, which will help start-ups in securing funding to embark on the path of growth and expansion. It will support the mid-sized set-ups to leverage technology and innovation with cash flowing in from various investors.
If you are planning to purchase a business for sale in New Zealand, then you must be aware of the ways of developing it into a flourishing enterprise. Here is a list of expansion strategies which are suitable for a start-up to achieve the desired growth rate.
Cover A Wider Target Audience
The first step of an expansion plan for any start-up is to cater to a broader base of customers, which will improve both sales and profits. It entails short-listing new market areas that can be penetrated to find new customers. You must make sure that these territories are not already saturated with competitive products.
You will have to devise a marketing strategy to woo the audience in the area after researching the region thoroughly. The demographics and psychographics of the population will help you in creating a marketing plan, which should be supported by a unique selling proposition.
It is like establishing new branches for a retail chain in different locations, but only after understanding the consumer behaviour of the residing population.
Bring New Products On The Table
If you are not comfortable with the idea of entering new markets, you can take the simpler route and opt for the introduction of new products or services in the same marketplace. Thus you won’t have to acquire new territories but will have to entice your existing target audience to buy your fresh range of offerings.
However, this is not as simple as it may sound. You will have to determine which product or service is not already in the market to make it work. If you are launching something similar, then you need to ensure that it is different from the products of the competitors.
You will have to find out the gaps between the expectations of the customers and the goods being delivered to them. While surveying the demand, also keep in mind your budgetary constraints before taking any hasty decisions.
Expand Your Delivery Network
The availability of your products makes a lot of difference to the sales figures. For instance, if your delivery network covers only one store in a radius of 10-km, then the sales will be far lesser than when you are selling at 10 stores within 10-km. In many cases, the customers resort to competitive products when they are not able to find the product of their choice.
So you need to figure out the areas with higher demand for your goods and stock them with more inventories and collaborate with as many stores as possible to meet the needs of the target audience.
Cash Flow Management
Financial management is a significant aspect of running a business, and a deficit can easily make the organisation go down. On the other hand, a successfully managed cash-flow will help in generating ample profits that can be investing back into the business for growth.
Also, the reserve capital can help you in making the most of the available opportunities while it can be difficult to accomplish your goals with limited reserves. The utilisation of working capital, debt management, and acquiring funds must be monitored and controlled for the effective use of cash. Budgeting and forecasting can aid in this regard.
Adapting To The External Changes
A business can become stagnant if it is not responding to the changing scenarios of the current market. From the altering market conditions to varying consumer preferences, you need to stay on top of all the happenings taking place in your external environment. Technological innovations are one aspect of paradigm shifts that take place often with the evolution of an advanced product.
If you keep holding on to the old beliefs and traditional ways, it would not be too long before someone would replace you. Thus you must plan and keep reviewing the market to understand the pulse of the audience and what is clicking with them. Keep working on training your employees, renegotiating contracts with suppliers and sourcing better quality stock.
Recruiting The Best Talent
When start-ups plan to scale-up, they need experienced and qualified teams that can take their vision forward. A few people cannot handle all the functions, and growing operations need specialised people to take charge of the tasks. From skilled managers to IT experts and accounting wizards, you need to hire the best people to enhance the productivity of the organisation.
As you acquire more clients and the number of projects increase, your talented team can help in delivering the desired results in the stipulated timeframe. Thus recruitment must be your top priority when you are expanding.
Funding and Mergers
Funding can be arranged from angel investors who provide the seed capital for setting up a business and venture capitalists who are influential in offering the required funds for growth. Besides funds, businesses can also expand through mergers. Partnering with an established organisation can resolve funding related issues and provide the resources needed to achieve the business objectives.
However, before you go ahead with a merger, you must evaluate the financial health and brand equity of the company. Make sure that you and the merging entity are on the same page on business and legal matters. Also, draft an agreement with all the required terms and conditions, which are acceptable to both the parties.
Every business is launched with the view of becoming a thriving enterprise that records year-on-year growth. However, you need to keep improvising and adapting to accomplish this goal. Thus if you are planning to purchase a business for sale in New Zealand, then you must understand the expansion strategies to prepare for a progressive future ahead.