Industry Migration: Diversifying in a Stressed Economy, Part 2May 1, 2009
Last month we started answering the question, “In a stressed economy, how do you quickly steer your company into new industries and new sources of revenue?” We left off with an assignment to address specific objectives, given your existing market or industry focus, and identify a new industry or industries that you deem as viable for your business. Having made some initial determinations as to your match with a potential new space, we can start to look more closely at your target and take steps to move forward.
First and foremost, dust off your contact list. Networking is always your most productive means of credible introduction for any new prospect. Many trade groups are excellent sources of industry-specific information that can be very inexpensive. Consider purchasing industry-specific reports to quicken your understanding of various aspects of a given industry. Go with a reputable source, check customer references and als preview the material’s table of contents and some portion of the content to be sure that the report addresses the questions that you want answered. If available, ask the report supplier to allow you to review a section from another report that represents an industry within which you already have expertise. If you deem the material in the report accurate and complete, then chances are good that you will be satisfied with your purchase on an industry that is new to you.
Contact and evaluate trade groups to further probe, and once settled on a new target industry, scout tradeshows and join appropriate trade organizations. As you sharpen your focus, leverage social and business networks to understand as much as you can about the new industries that you are pursuing. Set aside time to cold call. Cold calling will push you out of your comfort zone and allow you to hone your ‘elevator pitch’ for concisely and clearly explaining what your company does and the value it brings—you need to be able to sum this up within a minute! Keep it simple. The goal is to capture enough interest to get 20 min. for a formal presentation.
Look for Ways to Stand Out
Be creative in offering nontraditional business models to attract decision makers. Look for ways to stand out from the existing supply base. Look at this as an opportunity to not only enter into a new industry, but as a blank slate to present your company in a new light. Be flexible, don’t confine your thinking to your present business model; be open to alternative approaches…be willing to say ‘yes’ and eager to learn. And be careful to temper optimism with some realistic bounds to ensure that you can follow through on your commitments.
Work to develop trust and to build your relationships. And work hard to demonstrate your value. Remember, you’re the new kid in town, so you will have to pay your dues and earn your place. You may even consider proactively tooling up for a part that represents what your prospects want to purchase. Then go through all of the motions to manufacture, validate, test and document the results as an example to present to prospects. This can be especially valuable if you need to enact a new quality standard, such as a TE Supplement to ISO or automotive tooling suppliers, or the AS 9100 standardized quality management system for the aerospace industry.