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Expand Smart: 7 Fatal Mistakes That Could Sabotage Your Expansion
Friday, September 06, 2024
Brian Smith
If your business has a database of satisfied clients, you’re sitting on a potential jackpot that start-ups and businesses with bad reviews don’t have.
I’m talking about cross-industry expansion: When a company expands into a different industry and experiences explosive growth, almost instantly, by selling the new product or service to the company’s existing client base.
Look around and you’ll see examples of this working everywhere.
Apple expanded from computers into handheld and wearable devices. Walgreens expanded from pharmacies to health clinics. Home Depot started offering installation services. Airbnb moved into “experiences” that included guided tours and activities. Redfin moved into mortgages and title services. Target expanded into grocery and personal care.
The list goes on and on because smart, ambitious businesses recognize how powerful cross-industry expansion can be.
What these all have in common is that the companies expanded into new industries - not just new products or services - while maintaining strong synergy with their core business.
And, most importantly, they saw sales take off immediately because they had a captive audience of satisfied customers/clients who already knew, liked, and trusted the company. It was like shooting fish in a barrel.
How big could it be for your business?
Here’s how Michael and I like to demonstrate it:
Let’s say you have 1,000 clients who already know, like, and trust you.
You expand into a different industry and offer your clients your new product or service.
Let’s say that 50 of them buy your new product or service every year.
And your profit from each sale is $3,000.
You just added $150,000 in annual profit using cross-industry expansion (without adding a single new client).
The bad news?
Expanding into a different industry can be a disaster if you go about it the wrong way.
It can waste enormous amounts of your time and money and become a burden or huge liability when done wrong. The following 7 mistakes are FATAL and to be avoided at all costs!
Mistake #1: No proven way to generate inbound leads
If you don't have a proven way to generate inbound leads, you'll have to either figure it out on your own and/or dump a lot of time and energy into outbound lead generation.
Either way, you're stuck wasting time and money on trial and error with no guarantee that you'll come up with a winning lead generator. You must be able to generate plenty of inbound leads at low or no cost.
Mistake #2: No confidence about what to say or do with the leads
If you don't know what to do with the leads once you're on the phone with them or in a back and forth by email or text, you're just going to blow your chance. This kills your closing ratios.
You've got to understand where their heads are at, the top objections to overcome, how to move them from one step in the buying process to the next, and how to set expectations for client responsibilities and product or service delivery.
Mistake #3: No solid plan to train your staff
No matter how awesome your staff is now at delivering an amazing client experience, they're entering a new world when you expand into a new industry.
You must have a solid plan to guide your staff through the inexperience of working in a different industry with new products or services. Without it, everyone is in for a bumpy ride and there is a good chance you let your clients down and tarnish your reputation.
Mistake #4: failing to recognize upfront that the industry is not viable for your business
If there is no market demand from your client base, the margins are too thin, the product is always out of stock or too difficult to deliver - anything that destroys sales and profits should be uncovered in advance of expanding into a new industry.
Mistake #5: Not understanding common pitfalls and easy safeguards to prevent mishaps
This is what causes screw-ups and complaints. Whatever new industry you expand into, you should be made aware of what is likely to go wrong as a newbie delivering the product or service and implement simple, easy safeguards such as staff training and checklists to prevent the mistakes from ever being made.
Mistake #6: Thinking that success in your current industry automatically guarantees you success in another
If you have the resources and organizational skills to expand into another industry, it's a safe bet that you've already created some success in your core industry. Sometimes this can blind us as business owners into thinking that everything we touch will turn to gold.
Success with cross-industry expansion is often a combination of your experience as a successful business owner coupled with an open mind and a willingness to learn and try new things, not a know-it-all attitude.
Mistake #7: You and your staff are not a good fit for the work that's involved to deliver a quality result
If you and your staff do not like the type of work required to market, sell, deliver, and maintain the new products and services, or if your skillsets are not a match, your new industry will feel like a ball and chain for everyone involved and likely affect your core business in a negative way as well.
Could this be for you? cross-industry expansion into this 1.4 trillion dollar industry
Here at Mortgage Systems USA, we've developed the only complete, turnkey profit center available for cross-industry expansion into the high demand, 1.4 trillion dollar mortgage industry.
With our program, in as little as 60 days, non-mortgage business owners are able to make money by offering mortgages, home equity loans, and reverse mortgages to their clients - with zero mortgage experience and without having to become mortgage experts.
Our program includes:
- Proven marketing systems to make your phone and inbox light up like a Christmas tree with inbound leads from your clients, sphere of influence, business networks, and social media audiences - for little or no marketing cost. No cold calling or selling to strangers required.
- Proven sales systems that walk you and your staff through example conversations with clients - conversations that lead to loan applications and big commission checks without seeming fake or salesy.
- Proven operational systems to ensure delivery of a 5-star borrowing experience that converts your clients into raving fans, walking around like billboards and bringing you business.
Want to learn about making killer money by offering mortgages, home equity loans, and reverse mortgages to your clients?
We call our program the Mortgage Facilitator and for many businesses – such as insurance brokers, divorce and probate attorneys, trust and estate planners, tax professionals, financial planners, real estate brokers and agents – this is the ideal cross-industry expansion.
If this looks interesting to you, click the button below to learn more.
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This is not legal or tax advice. Consult your attorney about legal matters. Consult your tax professional about tax deductions. Consult state licensing authorities about licensing matters. Earnings and income statements are estimates based on our experience. There is no guarantee you will achieve similar results. Any earnings or financial benefits can vary based on your individual circumstances, skills, and the specific actions you take. You should always conduct your own due diligence before making any financial decision.
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