Benefits and Risks of Exploring Other Products to Expand Your Business
After starting your company for some time, you have already created your brand. Everyone knows what your name is synonymous to. It’s a good thing that you succeeded in branding. Many other companies struggle to even make a mark. When someone mentions the name of the brand, no one knows what it is.
Since you’re confident of the status of your business, you might decide to do more. You think that it’s time to look for other ways to sustain your brand and keep the profit coming. You also want to maximize your current customers since they’re already loyal to the brand.
One of the strategies you might think of is to expand your company to include products beyond what you currently sell. For instance, if you’re popular for selling cakes, you decide to also include beauty products. This decision could go both ways.
The positive sides of expansion
When you decide to include other products, it helps expand your identity. Your current customers won’t feel bored because you have tried to offer something else. Besides, you already have these customers in the fold. You just need to push them a bit to convince them to buy the new products that you offer. Expansion is always a good thing for businesses that are capable of doing it.
The possible risks
The first risk on trying out other products is that you could dilute your brand. People already know you for a specific product. It will confuse them if you introduce something else. It’s understandable if your new products are a variant of the existing products or something close to what you already have. Otherwise, it will dilute your brand and turn some people off.
Another problem is that you run the risk of focusing your attention on improving that new product. You won’t have time to focus on determining what else you can do with the product that made your company successful. In the end, everything will suffer.
Expanding your products also means that you need to invest more. You will take a risk and wait for some time before seeing the return of investment. There’s a possibility that this new endeavor won’t succeed and your entire business could be on the line.
Carefully calculate both sides
It’s your choice to determine if you will expand your business to include other products or not. Make sure that you understand the risks and opportunities of every decision. You also have to speak with your finance team to determine the best move. If you can hire an independent third-party financial advisor, it’s even better. It’s always a risk, but you can minimize it when you know what to expect. Once you decided to go for it, you have to work harder, and so will everyone in your team.
Photo Attribution:
1st and featured image from https://www.simon-page.com/wp-content/uploads/2017/11/branding-1.jpg
2nd image from https://www.newtimes.co.rw/lifestyle/routes-take-when-expanding-business
