Expanding Horizons: Mastering Market Entry and Risk Management for Small Businesses

Unlock the potential of untapped markets with our latest Country Intelligence Report, as your hosts Spencer Bentley, Devin Floresack, and Tyrell Cummings guide you through the maze of market expansion for small businesses. We're laying out the roadmap from in-depth federal spending analysis to pinpointing hot industry trends, with a special look at the buzzing energy market. If you're weighing the benefits of hiring market research firms against the intimacy of customer feedback, we've got the insights to make that decision clearer. Plus, we dive into the importance of understanding your competitors and identifying the perfect niche to keep your business thriving while aligning with client needs.

As we navigate the choppy waters of new contracts, we illuminate the art of mitigating risks and the telltale signs of a contract that may be steering you off course. Uncover the treasures hidden within resources like Samgov and FedScope and hear firsthand how strategic partnerships can be your north star in unfamiliar territories. We also tackle the often-overlooked internal landscape, discussing how to maintain the delicate equilibrium between pursuing new directions and preserving your team's spirit and client satisfaction. Our chapter on risk mitigation is a can't-miss for those ready to bolster their business defenses.

Finally, we examine the shift in workplace dynamics with a focus on telework and its profound impact on employee retention and job satisfaction. Reflecting on insights from the Office of Personal Management report, we dissect how generational divides are shaping the future of work-life balance. Hear our personal anecdotes that spotlight the real-world choices job seekers make when they stack telework flexibility against in-office salary offers. And if you've ever pondered the hidden costs of office work compared to remote positions, our financial comparison is an eye-opener. Join us as we continue to explore and inform on the evolving landscape of the workplace with the Country Intelligence Group.

• Hosted by: Terrell Cummings & Devon Florczak
• www.countryintel.com
• Twitter
• Linkedin
• Facebook

Transcript

Speaker 1: 0:20

Hello and welcome back to the Country Intelligence Report.

Speaker 1: 0:24

We are your hosts, spencer Bentley, devin Floresack and Tyrell Cummings. Today we're going to be talking about venturing into new markets and how small businesses can expand and grow in different markets that they are targeting as a method of continuing to explore how they can build their business. This is something that we at Country Intel are currently undergoing, so we thought it would be a good topic to touch on and share some of the insights and pitfalls and lessons that we are learning from this process. Hopefully it can be helpful for other small businesses out there. We have three main topics. We're going to hit three areas of focus that we found are crucial for understanding how to best go about entering into new markets. So we'll just start from the top, the first one being one of the more obvious, I think, and that is conducting market research and analysis, and we can sort of go around the horn here and just get our thoughts on what this means and how it can be best leveraged to enter new spaces with the limitations of being a small business.

Speaker 3: 1:43

Yeah, regarding market research, it's an obvious first step, but I don't think people know actually where it actually gets started. For me, I think it really just starts with the money and following the money. If we're talking federal spending, it's pretty easy to go out there and see which federal organizations are receiving money from Congress, how much money is being set aside for each of these, and there are various sites that you can go to and sort of track these things. Whether you want to see trends for the last three years, the last year, the last five years, it's really helpful to at least establish a baseline for your market research, and I think starting with the money is obviously a good start. The second piece of that could be just looking at the trends in the news and seeing what's prevalent at that time.

Speaker 3: 2:48

Obviously, with the DOD, everyone knows that DOD spending is just going to keep going up and up, especially as there's more conflict in the world and for us at least, since we're looking to maybe branch into the energy market, something that we saw was one there's a lot of energy going into, or not a lot of energy, a lot of money going into the Department of Energy right now, and obviously energy is a big topic in the news and everywhere you look now, whether it be people talking about how are we going to expand the grid research towards nuclear energy. There's just a lot of buzz right now around the energy topic in general and that's how we came to the conclusion that Department of Energy might be next. But for me personally it starts with the money and definitely then branches into what's in the news, what are people seeing each day and what's the hot topic. I guess.

Speaker 4: 3:56

Yeah, no, devin, I definitely agree with what you're saying there and we know things for businesses as if they're thinking about expanding to a new market and everything they're doing their market research. What industry are they really going to go into? Are they going to move into Within that industry? Is there a particular niche within that industry where they can fit in? Obviously there in schools or any big programs talking about red oceans. What's the competition in that particular market that they're looking at and those types of things? Are there barriers to entry? Or what are the barriers to entry? How hard is it to enter that market? Is it an expensive market to move into? Are there certain certifications that your company have to have, that your employees have to have? Is there certain people, certain types of experience that you need to bring out to you within your organization? Is that something you can afford?

Speaker 4: 4:47

As far as doing that, I mean obviously small businesses. A lot of times they are more conscious about their money, about their budget, because a lot of times they've been running on a finite budget for, however many years, and now they're trying to expand and trying to grow that ideally, but they can't take all the steps that a large company would as far as their market research process or analysis. So they might, if they see it, if they really want to move to a particular market, hire outside firm, do market research on their behalf who specializes in market research and then provides the data that they can follow up on and make a good decision on what direction they want to go. Or, you know, they may, if it's something that their current customers do, maybe they serve their current customers since they already have the proper contacts.

Speaker 4: 5:37

As far as doing that. I think that's a hard thing about market research. If you are going to try to reach out to companies within that industry, are you getting to the right people? Will you get responses? Are you getting enough feedback or enough responses to be able to make a conscious decision on what to do next as a company? So I mean, I think those are kind of like different factors. You know, outside of the following, the money that you know businesses, or just small businesses, may have to follow or may run into as they're trying to do their market research.

Speaker 1: 6:09

Yeah, that makes a lot of sense and you brought up a really good point, terrell, and I think broadly, for any company looking to make some sort of strategic expansion, it really needs to start with understanding the customer's needs. You know, it's one thing to have an idea of branching into a space, but to actually make it actionable and successful you really need to understand that there's a desire for what you're trying to provide there, because you can throw a lot of money into marketing and advertising a service or a product to a new set of customers in a new sector. But unless there is some, you know, some pain point you're looking to, you know, to focus on or solution to an obvious problem that you're looking to provide, it can really all be for naught and end up, you know, wasting a lot of resources, sort of impacting the overall morale of your company really on a higher level, if something does go, you know, wrong in that respect. So understanding the customer's needs beforehand I think is really is really crucial, like you said, terrell, and then also just identifying opportunities, you know, taking the time out to look and do your research and dig into your potential competition, seeing where they may fall short, whether it be in. You know, whatever sort of product or service you're trying to provide, if that adds, if there's some competitive advantage you can leverage there, and you know really pushing hard to exploit and take advantage of any opportunity that you can find to get your foot in the door in that respect. And then you know, making sure that you're not trying to fit what is it? A round peg in a square hole or square peg in a round hole? Never know.

Speaker 1: 8:17

You know, and that's about, like tailoring your product or your service.

Speaker 1: 8:20

You know what I mean, like, not not just, obviously it's all circumstantial, but more often than not, if you're looking to sell what you have to a new set of potential clients, you're going to have to, you know, to some degree customize what you offer so that it's specifically addressing their needs and not just trying to, you know, force them into a certain, a certain bucket or a certain product or service that may not necessarily be or may not necessarily make sense for what they need.

Speaker 1: 8:59

So just understanding that you're going to have to have that flexibility and I think that's something that I think we can all agree on is that there's a high degree of flexibility that's required sort of across the board from your business. If you really wanted to be successful, you have to have a much more fluid attempt and really tap into the things that got your business started in the first place, which was, you know, being able to be quick on your feet and think and adapt and learn the language of whatever space you're trying to get into, so that you can really quickly build up some brand legitimacy and start to become sort of a known quantity in that certain space that you're looking to occupy. So yeah, and you know, please go ahead.

Speaker 4: 9:51

No, I also think that companies need to figure out a way to truly differentiate themselves from the competition, like what's going to make you unique, what makes you different from everybody else that's out there, like, yes, you can provide these different services or whatever, but like what's going to make you different from the other five, 10, 15 companies that are trying to contact me? Try to get similar services to what you're offering? What makes you special? You know and that's that's probably the hard part you know a little bit and you know if you're in an industry where you know we can be talking about, you know, in general recruiting or staffing or whatever, you know, like there's a lot of companies that do that. You know what's going to make your company special. You know, versus all these other companies that we talked to and I can do it at a better price, or they have more experience, or they have specifically, you know, a pool of potential. You know C-suite executives that are available at their you know. You know at the call, you know at one button push and it gets on there right now Like what's going to make you special, what's going to make you differentiate you from everybody else?

Speaker 4: 10:59

So I think that's one thing. If you want, you can figure that out and differentiate yourself from the competition. That's when you'll probably see more success, because then you'll really focus on that and say, hey, we do this compared to everybody else. Yes, we're in the large industry. There's a lot of competition, but here's where we are special, here's what we do really well and here's why we can bring value to your company and show you that going forward. So I think that's one of the most important things is how can you be unique versus the competition that's out there?

Speaker 3: 11:29

Yeah, you know. I think Carl, you had a point earlier I think you were talking about potentially you know, when you're doing your market research, that you can actually hire some companies to help you do some legwork, and I think you know that's something that we do. You know we have some more analyst based companies that will look at you know the markets that we're in and give recommendations on what we should go after, and I think companies like that can definitely help because those companies will obviously you might just be one of their clients, but if they have a wide portfolio of clients they can say well, here's how you compare to our 10 other clients. We think that you can potentially differentiate from them if you do such and such. So I think there's definitely some ways to find that sort of variable that gives you the extra edge and maybe paying the players the answer as well.

Speaker 1: 12:33

Very true. Yeah, great point. I think there's a lot that goes into this whole process of trying to break into a new sector, and that is a huge one. I think that if you take a holistic approach as a company to understand that doing this legwork upfront can empower the company in a lot of ways that are not necessarily specifically targeted toward this venture. I say that to say, if you hire a country Intel to do market research for you looking to enter into the widgets industry, the insights that you glean from that market research on how to identify the competition, on how to differentiate your product or service, that can inform everything you do and it can give you a fresh perspective on the industry that you're currently servicing as well, because it can expand your understanding of what some general pain points are and what the broader industry or sector or economy is requiring from your type of service at this time, and it can just pay dividends in a lot of different ways. So definitely good points there.

Speaker 1: 14:02

This kind of dovetails into the next point, which is understanding and accounting for risk management in these situations, because with entering into a new sector, you're definitely taking on a lot of risk. You're investing money, you're investing time there's a cost-benefit analysis that has to be done and there's a lot of just potential risk with going into something that you are completely sort of agreeing to or you're not equipped as a company to completely pivot towards. So a lot of times a company is not just going to give up their old clientele for the new ones and pursue their new ones. You kind of have to do both at the same time and that doesn't just pose a risk in terms of it could be an unsuccessful venture ultimately if you don't go about it the right way in this new sector. But you're taking time away potentially from clients that are already servicing, and that in itself is a risk as well. So, yeah, what do you all think about just how companies can sort of navigate the risk management aspect of this exercise?

Speaker 3: 15:25

Yeah, I mean being friendly with other companies that are going through the same thing can definitely help, because you can get some pretty quick lessons learned, especially if you don't really have a lot of experience or you're looking to break into an area. You can definitely get some lessons learned by just talking to them and interacting and say what worked and what didn't. And especially for us now, since we've been doing it for so long, when we're looking at new contracts right now, I think we're pretty good at telling right away whether or not we should go after it. But that just came with time, of course.

Speaker 3: 16:11

But I think just generating experience on being in the market and studying what opportunities are out there we always mentioned, like Samgov and FedScope, the websites, that sort of aggregate, all the contract data that's coming out those are good places to start looking at and building your sort of feed of new work that's coming out.

Speaker 3: 16:35

And once you start looking into the different things that are being posted for work, I think you eventually come into a pretty good idea on whether a contract is good or not, whether your company should be able to handle it. If sometimes, from what we noticed, we could tell if a lot of the contract scope was potentially written by another contract company, just depending on the language that's being used and how specific it is. Just pretty much being very logical about the process and seeing what's out there and what's not out there as far as things that might be available and good for your company, I think is a good way to go about it and just building the experience up. But, like I said before, being friendly with companies and people that already have an end in the space is good as well, of course. Yeah, I think.

Speaker 4: 17:36

Sorry, I was just saying definitely. I hear that Devin leveraging those partnerships or people that are already in co-sorting an industry. Find partnerships with alliances. If you're a filled with industry but not spooned with other companies, you kind of go under them and serve an artist as being self-contracted to them or whatever that may be. Have a partnership is kind of learn to lay the land, understand the different things that they may know more of just because they have more experience in that industry for that timeframe, and just learn what you can and go from there.

Speaker 4: 18:09

Also, as far as risk, the market resource can help you identify some of the risks that's out there, right? So whether it's like political risk or regulatory risk or economic risk and that kind of analysis, like you kind of know what's out there. So ideally, companies will go ahead and put together some type of risk mitigation plan, like, okay, here's what's going on, here's kind of the lay of the land that we see so far. If this happens or such such happens, here's how we're going to adjust our strategy and go forward and make sure it's not just a one-time strategy, right, like it's something that's probably always going to be evolving. You never know what's going to happen.

Speaker 4: 18:44

As far as risk, ideally you think you know what direction is going to go but, like anything can happen. Anything's possible as far as that. So just try to mitigate that risk as much possible or keep it as under control as possible. So it's just a small business, so you're not wasting funds or spending more than you should or whatever that may be, which I know is kind of tough as a small business moving into a new market because you want to grow, you want to be quick, but maybe something that just takes a little more time as well. So you just have to create that strategy, stick with that strategy and with that risk mitigation strategy and try to learn what you can from those partners as well, and I think that's something that will help the process.

Speaker 1: 19:32

Yeah, definitely that market research can definitely go a long way in the risk management sort of you know, exercise and fortification for the company. I think you have to really be really intentional about your moves in this regard as well. You know it can't be something that you sort of dip your toe into and you don't really have a solid plan. You have to have a risk management plan. You know how are current clients going to be impacted by our shift or our pivot towards this new sector or this new market? You know, how do we provide what we believe to be our quality of service or product to the new client without impacting overall productivity or without sort of ensuring or while ensuring part of me that your employees are on board and don't become disillusioned with the direction? Do you have internal buy-in? If you don't, how can you amend that? All of these things have to be, I think, very plainly stated by the leaders of this initiative, and then you have to come up with a very unambiguous plan on how to address these things. Otherwise, you know, being caught on your back foot as a leader of a company is no trivial matter. It's the difference between you know, the livelihoods of the people that you employ being impacted or not being bolstered by this new stream of revenue and these new opportunities, or you know sort of crumbling under their feet because this pivot was poorly managed and you didn't account for some of the more obvious risks that could have been. You know, planned for ahead of time.

Speaker 1: 21:42

Developing a plan, sticking to it while also being flexible is key again, that flexibility aspect that I touched on earlier and then just being adaptable.

Speaker 1: 21:55

You know being able to understand that you may need to make some changes to your current sort of operating procedure in order for this to be successful, and not shying away from those changes.

Speaker 1: 22:08

And you know being ensuring that you have as much fortitude to pursue this vision as you did when you were starting the business and you were building up your current clients. I think all of those are crucial and you know sort of rounding out this discussion Devin, you touched on it for sure is that you know understanding how collaboration can be a vehicle and a method of expansion, and you made a really good point about you know how connecting and relying on companies that may already be in the space can really sort of curb your learning curve when you're trying to enter into the space and I think that that's a very powerful point. And you know that's one of those tricky things because it's obviously, you know, has a lot of benefits for the company looking to enter the space, but you have to make it make sense for the company that you're trying to connect with as well, because nobody wants to train the competition right. So then, how do you navigate those spaces is interesting and I'm wondering if you guys have any thoughts on that.

Speaker 3: 23:23

Yeah, you know something that we do is, you know we partner with a lot of companies. You know through a you know teaming agreements or joint ventures and the companies that we partner with at least you know we interact with conversations. You know they're usually pretty. You know up in front of the center and say like, hey, you know this is our company. You know this is what we do well, you know what do you guys do well and usually in the first you know 10 to 15 minutes we're able to figure out. You know if we're we're a good matter not depending on you know if the things that you know, obviously you know if you do well and they don't do well and then you know they do something well that you don't do. You know that that's typically where you find a good match for you know teaming agreements at least, and that's teaming agreements is something that is, you know, very beneficial to those with solid business set-asides, at least within the DOD. You know utilizing teaming agreements, you know it definitely bolsters the strength of a lot of proposals, especially for, you know, work that comes out that has a you know, higher dollar amount. You know a lot of organizations are, I wouldn't say, worried, but you know more. So if they come out with a you know eight-figure dollar tag on some work and if you're a small business only, like you know 30 people, you might not get much consideration if you, you know, end up sole applying for that. Versus a proposal that comes in, you know, backed by you know three companies, because then you know the organization might look at that and say, you know there might be some more stability. You know, seeing that this proposal is backed by you know three companies with a teaming agreement, you know, versus just you know, one single source company. So I think that's very beneficial to small businesses.

Speaker 3: 25:25

And you know, even when you look at you know work that's you know set open, where you know some of the big guys can jump in. Even there as well, you know, if you could team up with a couple companies and, you know, go against one of the bigs, that definitely helps your case as well. And I, you know, as far as you know the small business organizations and you know the advising groups that you know they actually advise that companies do that, you know, just as, like I said, a way to bolster your case. So you know this is something that's, you know, actually promoted at least within the DOD. You know making sure that you are clattering with other companies to, just you know, help straighten your case on. You know why you should actually want some work.

Speaker 1: 26:14

Yeah, and in the private sector?

Speaker 1: 26:17

Well, in the public sector obviously the DOD there are mechanisms, like you said, in place to support these sort of ventures.

Speaker 1: 26:30

But in the private sector it's much more sort of a purely capitalist open market structure and I think when navigating those circumstances it becomes incumbent upon the company looking to enter into a sector to understand how they can marry their services or products with a company that's already established in the space but maybe has services or products that are adjacent to what they offer, so that you can create some sort of new novel service or product that can answer a broader set of questions or concerns for your potential clients.

Speaker 1: 27:10

If you have a staffing firm that's looking to enter into a space, maybe look for a company that maybe offers some sort of educational services, a country, until we offer both. But those are the two sort of adjacent offerings that aren't necessarily in competition with one another and will benefit from some sort of partnership. That can take a little bit of research. Again, the upfront market research can probably be very beneficial to understanding where that may be applicable. But in the private sector you have to be a little bit more, I think, tactful with how you approach this as a method of expansion, because the competition is real.

Speaker 1: 28:09

There's only so many clients for any service or product. So you really have to understand and be, I think, creative in your approach and understand that you have to make it beneficial for both parties involved. How you do that can really come in a numerous amount of ways, but it's important that you take that into account as well.

Speaker 4: 28:35

I definitely agree as well. One thing the small business can't think about is typically there are local, the local small business administration location. There are programs set up and I think it may go state by state where there are potentially mentorship programs that are out there where you can't team up with a larger company that has more experience in your field or went out there and you can learn from that company. If they're part of that program. They want to be a mentor in that particular program. Those programs are out there for small businesses, for the economically disadvantaged businesses that are out there and there's a minority owned businesses that are out there women owned businesses, veteran owned businesses.

Speaker 4: 29:20

There are those different distinctions that are out there where, if you're a small business and you want to enter this program or pick up programs I know in Ohio there are definitely programs that are set up to do that where you can get set up with a mentor and they can show you different things as far as going through the process of running small business or maybe some pitfalls or things to look out for within the industry and whatnot there, and you can learn from them as your business grows. You can learn from them as you go through certain lives. Then you break away and you are able to do your own thing as well. That's for the more of those businesses that are really just starting, or whether or not they haven't heard a certain dollar value revenue wise or went out there and they want to try to learn more and grow more. There are programs that are in place, who you probably will, small business administration as well, so that's something to remember.

Speaker 1: 30:09

Great point. Yeah, that's a very powerful resource. This is obviously, I think, a process that has to be really well planned for maintaining that flexibility and something that I think, as a small business owner, you have to really be very clear on your vision and how you want sort of the end result to look in terms of how this rebalances and recalibrates your current business and how this allows for expansion, not only into the new market, but also how this will facilitate expansion in the markets you are already servicing. Definitely a great discussion here. Before we wrap it up, we want to dive into our new segment that we have. Well, we just sort of discuss what's on our mind with current events, things that we have seen in the news, things that we have been reading about or have a personal interest in, and give a little bit more of a deeper insight into how we think here as hosts of this show and things that interest us. Devon, I'll start off with you, man what's been on your mind?

Speaker 3: 31:37

Yeah, obviously we kind of meet before and we talk about what we're going to talk about, and I think mine is going to be kind of related to yours. I was reading some stuff about how there's a report that came out from the Office of Personal Management that was finding that telework is a significant factor in employee retention within federal organizations. I thought that was kind of interesting because obviously within the last six months the Biden administration has been trying to have a push on getting more people back into the office. But when OPM actually did the surveys and took a look at the data and what people were actually thinking about returning to the office or looking for new jobs, it pretty much said that employees that frequently telework are more likely to stay in their job with the government versus those that do not. I think the numbers were like 60-ish percent that said they work telework would be more likely to stay instead of jumping. Then the other number was that for the folks that were going to the office still, I think 40 percent were considering actually staying and leading towards jumping. So it was a significant difference.

Speaker 3: 33:00

We've obviously talked about telework before and retention within the federal workforce. That's definitely going to be a as we said before, that's a big issue right now, especially because the workforce is a little bit older. To me, that's something that I think that the government should actually lean on. More so is offering telework, because for the people that I know are looking for jobs right now, they all say that most of them are more so actually in office versus telework right now, and that they would prefer a teleworking job, obviously for the most part. So I think that's something that the government should actually lean on, despite what the Biden administration might be looking to do, and this article reflected that data, so I thought that was interesting.

Speaker 1: 33:58

Yeah, that is interesting. I mean just briefly, I think that it's a weird, I think, generational thing that's going on. Obviously there are other commercial and financial aspects at play with what are the economics of telework, the impact on things like rent for office building, stuff like that. But I think, just down to a base individual level, there's a generational divide where, let's say, maybe older millennials to young Gen Xers see a very strong benefit and down, young Gen Xers and down see a strong benefit to teleworking because we found that we enjoy a more of a work-life balance and there's a real, I think, dollar value amount that we attribute that to when looking at potential jobs Like it's how much am I going to get paid? And then what is my life going to be like working for this company? Am I going to be in an office for nine hours a day, commuting an hour both way?

Speaker 1: 35:07

Some people like that, some people don't, but I don't know if you guys agree or not, but I think there's a dollar value amount to be attached to that. And for me personally, if it's down to two different companies and company A is offering 10,000 more, company B is allowing for a more flexible work schedule, be it hybrid or work from home. I'm more likely to go with company B. I find that that benefit right there for me is a real premium, and I think that is a generational thing, because a lot of boomers they grew up with a different set of values and a different understanding of what the role of work should play in your life, so that's really interesting.

Speaker 3: 35:56

Yeah, yeah, and that's a real life example. That's something that I've seen recently with some of my friends who are looking for jobs, where one of them had an offer for a job that was teleworking and they're pretty much going to get paid what they're making at their job. Before I think they were later getting paid maybe like an extra dollar more per hour or something like that. That's what the math came out to and for a number of sake I want to say roughly they're offering $53,000 a year or something like that. And then obviously they're interviewing other companies and they let them know, like I have an offer on the table for a job that's teleworking at this amount here. And the one company actually took that into consideration for their offer because they were saying that their work with this company would be pretty much in person but they would have 20 or 30 days allotted to work remotely.

Speaker 3: 37:02

But they took in consideration the salary that was being offered and actually bumped the salary of the in-person job up more to I think it was like $62,000 or something like that. And we ended up doing the math on it and we said if you're working 40 hours a week here, teleworking, you can assume that's pretty baseline versus. If you're going to the office and you got a drive there, you got to maybe go out for lunch, whatever. That's an extra hour, hour and a half each day. When we did the math it looked pretty similar. That's pretty much. The dollar amount was worth the $53,000 versus the $60,000, or it was actually like $70,000 or $8,000. So I thought it was interesting that they actually did the math and took that into consideration that there's definitely an extra cost to going in the office and spending time there versus just working at home.

Speaker 1: 37:59

Yeah, what did your friend end up doing? Did he take one job or the other?

Speaker 3: 38:04

They ended up taking the remote job, so I feel like most people are younger just end up leading that way right now.

Speaker 2: 38:14

Thank you for listening to the Country Intelligence Report. Please like and subscribe to stay on top of the latest developments with the show. For more information on the Country Intelligence Group, please visit our website at wwwcountryintelcom.

Speaker 1: 38:28

You can also be found across multiple social media platforms at Country Intel.