Generally speaking, market penetration can be described as the extent to which your business has penetrated its target market and demographic – it’s a measurable and quantifiable way of gauging how successful you’ve been in both infiltrating and selling within a specific market.
While understanding the current successes behind your business’s market penetration, it is essential you also take new markets into consideration if you want your venture to ascend to the next level – but how can branching out into new international markets help you to reach a wider audience and boost your revenue stream?
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Establishing new revenue streams
After establishing yourself within your local market, an advantageous next step is to introduce your business and services overseas to potential new markets. It is recommended that you prepare by doing your market research in order to understand your prospective audience or clients, find opportunities to promote your business, expand your product range or even tailor your offerings to suit your new client needs.
By putting down roots in a new market and widening your target demographic to encompass offshore consumers, you should be able to increase sales across the board and establish trust in your brand across a multitude of different countries and economic climates.
Applying your existing business model to new markets (and tweaking and adjusting your processes and services to complement local consumer trends), you could see new revenue streams established overnight – this is especially if you conduct focused planning based on market research before setting up shop in a new locale.
Nurturing international business partnerships
Forming and nurturing business partnerships is known as a key driver for business growth.
By forging professional relationships with other relevant corporations in unfamiliar markets, your organisation can reap a myriad of benefits ranging from product sourcing options, diversification opportunities, and accessing larger talent pools for innovation and development or even employee onboarding.
Business partnerships (in which a business is commanded by several owners) tend to generate more income than expenses or outgoings, which means that your company is less likely to fall into the red when breaking into a new market.
Try to strengthen professional relationships and show your partners that you value their investment by providing them with perks and bonuses wherever possible, whether that be flying them out to meetings by private jet or providing luxury accommodation for overnight work functions – the value of face-to-face interaction should never be underestimated, particularly in business.
Discovering new markets and consumers
Because the value of products, materials and services can vary significantly from country to country, you may find yourself sitting on a potentially lucrative opportunity by branching out into new offshore markets and targeting foreign consumers.
It’s also worth pointing out that this can work both ways – you could see your profits depleted if you set up shop in a country or market in which your existing business model is not financially viable – For example – if your services are particularly niche and/or has limited demand, would a business expansion pose too high of a risk? Likewise, if looking to enter into an already trending and potentially crowded market, you may find that more strategy and expenses will need to be invested in order to gain a competitive advantage.
Consistent market research, particularly around industry trends and consumer values will be fundamental elements in the decision-making processes of your business’s developement.
Governmental tax incentives
If you’re looking for affordable ways to expand your business and penetrate a new section of your target market, you could benefit from a range of government-led tax incentives designed to provide a much-needed boost for certain markets and industries. Depending on the nature of your business and services, you could be eligible to receive perks and benefits including business tax credits and even tax breaks – for example, post-April 2023 UK SMEs may be able to claim a taxable credit at 20% depending on the profitability of the company.
Observing how you can explore and capitalise on the needs of overseas markets can have a significantly lucrative impact on your corporate development. Whilst international penetration is essential for market growth, nurturing the international partnerships that you create in the process will only enhance the success of your revenues and even your profits.
