When and how to start diversifying a business

This week, Fabiola asked Diario de un Emprendedor the following question: How to diversify a business and attract new clients? At what point are you ready to take that step?

Hi Fabiola. Before beginning to diversify your business, it is important that you begin to develop a good value-added proposal for your audience. This is very important to attract attention and capture a broader segment.

When I just started my business NetworkWarehouse, it sold through calls and then it was going to do a field installation of the software to the businesses that requested it. At one point I realized that I was spending a lot of resources in time and money and that, if I did it in another way, I could have a greater reach to increase my sales. Therefore, what I did was automate my processes, but without losing closeness to my clients: I offered my services online and I had to start developing a good value proposition.

Although I knew perfectly well that my product would provide a good contribution and good results to my clients, many times they did not take advantage of it to make it so. As RedAlmacén was only dedicated to selling the software and did not do any type of support, I finally began to notice that people invested in the product, but ended up not using it. I did not want that to be the case, because since I was convinced that this tool would give them results, I felt that I should look for something else so that they would effectively use it. This is how I made the decision to transform this business model, so that the product that was sold through a license was transformed into a comprehensive service with continuous support, permanent training and constant updates for business automation, which is paid monthly.

In addition, another very important point is to develop alliances: seek partners that allow to strengthen and grow the business and unite with other companies or other entrepreneurs who are doing something similar to yours. This will allow you to strengthen your value proposition, in addition to expanding your client portfolio.

Undoubtedly, to open new horizons and paths for your business, it is important to have a solid value proposition: that it makes sense for your audience to pay for what you are offering with your product or service.

Regarding the right time to take the leap of diversification, what I can recommend is that you ask yourself if you and your business are ready to do so.

I think a good time is when your business model is much more robust and what you are delivering has been previously validated by the customers themselves. Also, it is time when your business has a good work team that allows you to take that step: this is very important; if not, you will find yourself overwhelmed when starting to develop a new line of business.

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If you are presented with an alliance opportunity to expand your client portfolio, but you feel that your business is not yet ready to do so, it is better to wait and develop these key points well beforehand.

Three years ago I was presented with a good possibility of an alliance and perhaps it would have been the moment to diversify my business, but I did not do it: I analyzed very well the stage in which my project was at that time and I felt that it was not yet so consolidated. to accept this proposal; I decided to reject it to continue strengthening what I already had.

If I had made that alliance, I would have started to diversify my business even before I had it well founded, which could have finally caused the direction I wanted to take my company to change completely and probably I would not have been able to achieve things that I have done during this time. .

I do not regret having made that decision because I know that other opportunities will come. In the meantime, I have managed to consolidate my company much more and better prepare myself for when this opportunity presents itself.

I had a similar experience with the warehouse. When I just started my idea was to sell products related to this area, ranging from groceries to bazaar products. At a certain point I realized that I could start adding new products and services that would allow me to increase my client portfolio and my profits, such as phone recharges, bill payments, photocopies, etc.

Therefore, my advice is to think well before taking this leap and check different factors that will depend on doing so: if your income allows you to add a new line of products and diversify. You should also see if you have the time to go through this transformation period, analyze the team that supports you and choose the path that best suits the mission, vision and objectives of your business. After that, you will be able to take the great leap of diversification that, without a doubt, will deliver many benefits so that your business continues to grow.

We invite you to leave all your questions and concerns regarding their endeavors, which will be answered weekly by Verónica Oliva in this section.

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About Alex Marcell

He likes dogs, pizza and popcorn. Already a fanboy of Nintendo and Sony, but today throws anything. He has collaborated on sites and magazines such as GameBlast, Nintendo World, Hero and Portal Pop, but today is dedicated exclusively to Spark Chronicles.

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