Author: Henri Norio
10 new markets with the price of one
It is said about Finnish companies that they do not know how to sell or do marketing, especially on the international markets. Typically, the technique is top-class, but the selling style is engineer-driven and it focuses on their product’s characteristics. A common “safe” way to enter new markets is to think: “We’ll first test on the neighbor to see if there is need for our product.” However, is this the reason for moderate sales skills? Contrary to the statement made in the first sentence, Finns actually have the merits of a good seller in the international environment. They are famous for their strong expertise and trustworthiness. Both of these features are necessary for establishing good and long-term partnerships. But how is this achieved? Below are two examples of B2B-sales in an international environment which comparatively showcase the patterns of Finnish companies’ international growth.
The growth strategy, version 1.0
Company A faces a situation where growth in the domestic market has reached its peak but the company would still like to grow further. The international market could be the solution, but the amount of investments and other challenges seems quite troublesome. The Company A decides to open an office in Sweden and hire two senior sales representatives to enter the Swedish market. In the beginning, the plan seems promising. Representatives receive a good number of new sales opportunities and the negotiations continue on with successful. Then the first challenges appear. One of the sales guys decides to change career fields since this business does not seem the right path for him. The company had just finished onboarding this person to do his required tasks, however, now the company has lost valuable time and money. After a new round of recruitment and induction slowly everything gets back into motion again.
Company A operates in a rapidly changing technology sector and the developmental shifts of the industry can be unprecedented. Just when the company has overcome the first challenge, a replacement product for Company A’s selling article appears on the market, and the competition becomes tougher. This leads to a decrease in profitability, and potential sales opportunities fade away from the pipeline. The market changes over time and the company is forced to give up their growth strategy and return home. Several hundreds of thousands of euros are lost, and the only result achieved is the fact that this method of market entry did not work.
The growth strategy, version 2.0
Let’s move on to the second growth strategy case from real life. Company B decides to diversify risks and embarks on a more aggressive growth strategy than Company A. Company B decides to expand markets from one market to ten markets and at the same time they use the same amount of money as Company A. The main difference is that Company B uses a growth orientated partner who is able to execute that growth strategy. Company B has a scalable product, and the production is ready to receive an increasing demand.
The partner examines the target markets and they are capable of using their own resources to approach a number of selected customer groups and at the same time a number of different markets. The partners’ sales support expertise has proven to have a major part in the new opportunities of the international market. Company B does not go clogged with new sales opportunities, as the sales support covers 90% of contacts and the partner shares only the most profitable sales opportunities to the company. In addition, the sales partner takes care of the follow-up of the project if a deal is not carried out by the first contact. Company B is able to handle 10 markets at the same time because the time management is aimed at just the right companies. The expansion is executed in phases in 3-4 countries at the same time.
What is interesting about the 2.0 growth strategy is the fact that the company’s success is not dependent on one market only or on the individuals resided in the market. By choosing the path of Company B you can focus on the best markets and prioritize the winning markets.
Henri Norio works as a consulting partner at Excedea and implements growth strategies like growth strategy 2.0. You can get more familiar with our services here.
If you are interested to discuss the topic further please contact Henri Norio.