The best business strategy is one that leverages a business’s strengths for the greatest profit and yields the highest return on investment. A business must identify and execute a clear strategy to beat the competition and survive in the long term.
Here are 4 business strategies you may not have thought about.
1. Growth Strategy
Many businesses plan to grow and increase their sales and profits. But there are certain methods businesses must use to implement a growth strategy. The method an enterprise uses to expand its business primarily depends on its financial situation, the competition, and even government regulations.
One type of growth strategy is market penetration. Businesses use a market penetration strategy when marketing existing products within the same market they’ve been marketing to before. If you want to grow and expand when using existing products and markets, increase your market share. And, one way to increase market share is by lowering prices.
2. Differentiation Strategy
Differentiation strategy involves making your products/services different from and more attractive than those of your competitors. To do this, you must consider the nature of your industry and of your products or services. This primarily depends on features, functionality, support, durability, and providing a brand image that your target audience values.
To execute the differentiation strategy successfully, you need to conduct extensive research, and you must have the ability to deliver high-quality products/services. Also, you’ll require an effective sales and marketing strategy to make sure the market understands the benefits offered by the differentiated products/services.
3. Exit Strategy
You’re probably focused on building your business, not the day you’ll leave it. And to some extent, an exit strategy sounds bad. However, the best reason for having an exit strategy is to plan how to capitalize on a good situation, instead of getting out of a bad one. An exit strategy allows you to run your business and focus your energy and efforts on things that make it better and more appealing to acquirers and buyers you target.
Whichever exit strategy you choose, start working on it early. Planning early gives you enough time to do it right and maximize your returns.
4. Pricing Strategy
Determining the right price for your products is the most crucial decision you’ll make as a business owner.
There are many factors that determine the right pricing strategy. Sometimes, having the lowest price is not a strong position for a business because customers are likely to perceive their products/services as low quality.
Equally, it’s crucial for companies to price their products and services effectively to avoid situations where their prices take a hit because of being relatively high compared to those of their competitors. Also, businesses should avoid keeping their prices too low to maximize profits or avoid making losses.