According to Pordata, there are around 1.4 million small and medium-sized enterprises (SMEs) in Portugal, a figure that makes these types of businesses one of the main drivers of the national economy.
Although they were born small, these companies aspire to consolidate themselves in the market and then grow to become, perhaps, one of the most important players in the business sector.
This growth, however, doesn't fall from the sky. While luck can play an interesting role in this process, the truth is that expanding a business must have a strong rational and strategic component attached to it.
What is a strategy for expanding small businesses and what should it consist of?
A small business expansion strategy is the theoretical representation of a series of multidisciplinary steps that an SME must follow in order to advance its production, sales, turnover and, ultimately, its profit.
Given the challenges that each sector poses, the growth strategy must be adapted to each specific business and its objectives, be they the creation and promotion of a new product, the opening of a new sales channel or an increase in production.
Throughout a journey of expansion, we can identify four different stages of development:
1º Strategy design and developmentThis is the moment when, as a rule, the market is studied and the potential for the company's growth is realised;
2º Strategy implementationputting the strategy into practice and adapting it to the variables that may stand in the way of implementation and the final objective;
3º Stabilisation and Growthstrategy consolidation phase, which may involve the introduction of new technologies to improve profitability and efficiency with a view to growth;
4º ExpansionIf everything goes according to plan, the increase in sales and, consequently, in revenue will provide your business with the financial liquidity it needs to expand, in particular to explore new markets or launch a new product.
How to expand a business?
How to expand small businesses and achieve sustainable growth? What strategies should be put in place? These are questions that we're going to try to answer with these five expansion strategies for SMEs that we have for you:
1 - Analysing direct competitors and establishing partnerships
As well as allowing you to see what your competitors are offering and thus more easily find an unexplored path that your company can follow in order to present consumers with a product or service that is closer to their expectations and needs, market research can lead you to find companies with which you can establish symbiotic relationships that help you both grow.
2 - Review your portfolio of products and services
As a result of evaluating the market and analysing the metrics and consumption habits of your customers, try to understand whether your company's products and services can be improved, how they can be improved and what the market trends.
Carry out market research to assess consumer feedback on the potential development of a new product and whether it is possible to lower or raise prices.
Also consider testing new marketing tools and channels in order to reposition your company in the market.
3 - Market segmentation
Filtering and fine-tuning your marketing and sales strategies can help your company find new market niches and personalise your customers' shopping experience.
4 - Open alternative sales channels
The world of consumption has democratised.
Nowadays, consumers are becoming less and less "loyal" as to where they shop, meaning that they can either search online for a product and end up buying it in a physical shop, or restrict themselves solely to online shops because of the greater convenience and more competitive prices they usually offer.
In this sense, consider start selling online or at least consider the social media presence in an attempt to attract more consumers to its products and services and bring the company's name to a wider audience.
5 - Adopt payment methods in line with your customers' consumption habits
Not only has the way consumers shop changed, but the way they pay for their purchases has also changed profoundly in recent years.
For example, according to REDUNIQ Insights, the contactless payments today, around 81% of face-to-face transactions are already made using this technology. In addition to this, the growing use of digital wallets in face-to-face payments is also important.
All of this has led to the need for businesses to adapt to these changes. new payment trends not only to sell more, but also to offer a better shopping experience that leads customers to spend more.
With this in mind, REDUNIQ has developed the REDUNIQ Easy contactless PIN, REDUNIQ Smart e REDUNIQ SoftThe REDUNIQ Smart solution is the first of three solutions that, among other things, allow you to accept card payments by contactless, chip, QR Code, MB WAY, Google Pay and Apple Pay, install management apps on the terminal (only on REDUNIQ Smart) and increase sales in small businesses.
While POS terminals help small businesses that sell in physical shops to increase their sales and turnover, when you move to the online channel, the demands in terms of payments are different and will depend on the platform you use.
For example, if a small business sells through its own website, it is recommended to use a payment gateway such as REDUNIQ@E-Commercea solution with no monthly fee or annuity that will allow your business to accept online payments with cards from the main international issuing systems (Visa and Mastercard).
If business sells online without a website through other channels or platformspayment options have to be different and include, for example, turnkey solutions REDUNIQ@Payments. With no need for integration or minimum revenue, this solution allows those selling through the site to receive online payments remotely via WhatsApp, email or SMS.
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