Business development is a critical aspect of any business. Without gaining investors or clients, a business cannot survive. The objective of any business development activity is to move your company from an unknown position to a trusted (or favoured) position in the minds of your target investors, clients, partners, government officials or even stakeholder communities. Achieving a trusted or favoured position means that your business is ripe for expansion.
A trusted position also means that a businesses has established offerings, established services and an established client base.
Market expansion model
With reference to the Market Expansion Model, businesses typically develop from being in quadrant 4 (Q4), new businesses or start-ups, to being in quadrant 3 (Q3), quadrant 2 (Q2) and lastly quadrant 1 (Q1), mature, market-dominant businesses.
If there are discontinuous innovations (like new processing technologies) or market shakeups (a new competitor or a merger), a business’s position can revert to any previous quadrant.
Q1 is a secure position for companies to be in, providing there are no discontinuous innovations or market shakeups, since businesses only need to focus on their competitors.
Q4 is the most difficult to move away from, and typical for startups or new IPO, when the business is new and so are the customers. Such businesses need to invest resources into BD to get going, at the very time that they do not have the finances to do so. The trick is here to source the work without incurring the costs.