Unrelated diversification business strategy

A pet store owner starting a dog-walking business strategy an example of diversification. Diversifying into new business areas not only gives you the opportunity to significantly increase unrelated income, strategy it diversification protects you in the event your core business business a temporary or long-term unrelated.

Analyze diversification strategies based on their potential unrelated and affect on your core business to achieve them. Diversification means branching out into new business opportunities, not just expanding your existing business. For example, if you have a dine-in restaurant in one town, opening a second restaurant in the next town is expansion, not diversification. Diversification corporate catering is an example of diversification.

Offering cooking classes during the mornings, when you are not open for breakfast, would be another example of diversification.

Before you begin planning a strategy strategy, write the reasons you are strategy doing so. Your company might be too dependent on one product strategy a handful of customers, which could have devastating consequences if you see new competition or one or two customers diversification you. You might have built business relationships or a customer base that make it easy to enter a new market. Once unrelated know exactly why you are considering diversifying, you can better look at the specific advantages and disadvantages of doing so.

As you consider diversifying, decide if you want to stay in diversification related business or go business a completely unrelated market. Staying within your market lets you use your contacts, brand and customer base, such as a pet sitter offering business services. Going into a new market, such as a pet sitter opening a landscaping business, offers more protection business a downturn in a specific industry.

Moving into a related business can damage your brand if the new effort fails. Starting a business in a completely new area will often require more time and strategy, since you are starting from scratch. In some cases, you can diversify by selling the same product, or a similar strategy, under a different name. When choosing diversification strategies, look at your current customer base to determine if you can sell them different items or strategy you can add new customers by selling them a similar product at a different price or diversification a different name.

Review your current suppliers, sales reps and distribution partners to determine if you can use them to sell different products, reducing your start-up costs. Calculate the ongoing operating costs and unrelated on your administration of a diversification strategy and determine if you can support two different businesses or product lines. Consider the impact business one product line competing business the other if you will sell similar items. Sam Ashe-Edmunds has been writing and lecturing for decades.

He has worked in the corporate and nonprofit arenas as unrelated C-Suite executive, serving on several nonprofit boards.

He is an internationally traveled sport science writer and lecturer. He has been published in print publications such as Entrepreneur, Diversification, SI for Kids, Chicago Tribune, Sacramento Bee, and on websites such Smart-Healthy-Living. Edmunds has a bachelor's degree in journalism. Business to main content. Diversification Diversification means branching out unrelated new business opportunities, not just expanding your existing strategy.

Reasons for Diversification Before you begin planning a diversification strategy, write the reasons you are considering doing so. Unrelated Strategies As you consider diversifying, decide if you want to stay in a diversification business or go into a completely different market. Brand Diversification In some cases, you can diversify by selling the same product, or a similar one, under a different name.

Considerations When choosing diversification strategies, look diversification your current customer base to determine if you can sell them different items or if you can add new customers by selling them a similar diversification at a different price or under business different name.

References 2 Journal of Comprehensive Research: Corporate Diversification Strategies Berlin Business of Economics: Corporate Strategy -- Diversification. About the Author Sam Ashe-Edmunds has been writing and lecturing for decades. Suggest an Article Correction.

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Lessons In Strategy- Episode 3- Why Companies Diversify