When launching your business in the United States, it is of advantage to supplement decision making processes with the concept of Business Life Cycles. When you understand which path your business took to get where it is today, that understanding offers tremendous insights on what you may want to incorporate into your USA Market Entry Strategy and what not.
Business Life Cycles
While every business took its own, very individual path to where it is today, classic business school teaches four basic categories of business life cycles:
Start-Up: This phase ranges from the early stages where product or service is just an idea up to the point where the products are rolled out to the market. The start-up phase also includes the building of a customer base, brand building, market recognition and so on.
Growth: The growth phase is determined by a growing customer base and growing revenues. At this stage, organizations are usually spending a lot of resources to catch up the organization to keep up with ideally high growing rates.
Maturity: Once the business is established, it is reaching a phase of maturity. Sales is still growing, but at slower pace. The business is still expanding, but not with the same rates as in the growth phase.
Change: The business may stay in the expanding phase forever. But more likely, businesses or environments are changing. After maturity, the business may tap into another market and does the start-up phase again. Businesses may also decline or get sold. Or the owners simply cash out and exit.
Life Cycles and the USA Market Entry
The USA market entry is typically taking place during the growth or maturity phase of an existing business (unless the USA Market Entry is intended for a completely new organization with a completely new product without any existing infrastructure which is rare). The great potential for moving your USA business into the right direction is that you have a unique opportunity to analyze past business cycle, identify success factors and potentially apply them to the U.S. Market Entry Strategy.
Best Practices from past Business Cycles
If you look at the cycles your business went through, there are probably many things which worked out pretty good. Otherwise you would not have the successful business you have today. But there are also many mistakes which were made on the way: Poor business decision or wrong directions which offered valuable experiences to put the business back on the right track.
Now - at the phase of the U.S. Market Entry - is a good time to go back and in retrospect evaluate what worked out good and what did not. It is a good idea to formalize this process either in a SWOT analysis or in any other suitable form. The evaluation should include various business areas such as Marketing, Sales, Organization, and so on. What were good marketing instruments? What do customers like about our product? What are unique selling points in my domestic market? And so on. Remember: At this stage we strictly look at the existing business, not at the future U.S. business. Once we completed a formal analysis of the existing business, then we move to the next step: identifying what may works and what won't for the U.S. business.
What to incorporate in the USA Market Entry and what not
After we have a list of learning's and best practices from the existing business, we can now start to work out how we incorporate them into our Market Entry Strategy. Every point is now evaluated for its suitability to the USA market. There is of course always a level of uncertainty. Launching a business in a foreign country is always based on assumptions and some may be wrong, but that cannot hold us up moving forward. Additional research, help from local U.S. business people or professional marketing research may necessary in this stage to find out what may works and what not.
Analyzing past business cycles and incorporate "best practices" into the USA Market Entry strategy is a helpful tool to make your USA business launch a success. It can of course only supplement the decision making process. However, it is helpful to approach the market entry with the broadest possible perspective on your specific market as possible.
To be continued