The different types of growth strategies

Expansion should be in the objectives and plans of every business. Some of the growth strategies that businesses can employ are discussed below:

Market penetration

A business looking to grow can target additional market share without overhauling its existing products or services. This can be done by decreasing the unit price of the products or services, opening new retail locations, establishing a better online presence, or acquiring a competitor in the same market.

Market development

A bit similar to market penetration, market development involves targeting previously unexplored markets. One of the reasons to employ this growth strategy is the saturation of the current market or discovery of new product uses and market segments.

Product expansion

Product expansion or product development is a growth strategy with the intent to conceptualize and launch new products and services in the existing markets of the business. This tactic requires investing in research and development or in acquisition of rights to create and distribute another business or company’s products.

Diversification

Probably the riskiest among the types of growth strategies, diversification involves introducing new products or services in unknown, previously unexplored markets. To achieve success, a huge amount of resources is needed to be invested in market research.

Michael Saltzstein specializes in risk management and corporate finance. His work focuses on areas like alternate risk financing, loss control, technology solutions, coverage evaluation, growth strategies, among many others. Follow this Twitter page for more discussions about these subjects.