Dear Aunty B,
I run a small business with 19 people and about $2.3 million in sales, but I really feel that I have saturated the Australian market and can’t grow any more.
I have tried expanding overseas but found when I took my focus off the Australian operations they went backwards. I then tried getting someone else to spearhead the export push but that didn’t work out.
How can I grow?
Stuck in Australia
Dear Stuck in Australia,
It might help you to know that many share your problem. SMEs in Australia suffer from what the great Tom McKaskill calls “market-size optimism.”
Many entrepreneurs create new ventures because they can see an opportunity or a niche. They have usually come from business where they have worked in that sector before and they can see an opportunity, a few clients, a few people they can hire and off they go.
The problem comes when they literally run out of customers. The Australian marketplace is too small to run a profitable, sustainable business if you are a niche because the rate of new customers or the level of replacement sales is limited.
Now this is something that Australian entrepreneurs don’t acknowledge early on when they do their initial marketing plans because it takes about three to five years to get to $2 million and who projects out that far?
But in other countries like Singapore, New Zealand and Europe, they know their marketplace is small and so entrepreneurs start with an export focus.
So here is what you must do. Plan your export thrust better. First look long and hard at Australia. You need a CEO and leadership team in place that can run the operation with minimal input from you. That is step one. Then you lead the push overseas knowing you have the time to form relationships and the team back at home is as strong without you there.
Don’t forget to ask your current customers to introduce you to potential customers overseas. And look at competitor websites. Who are their customers? And of course use Austrade and other trade associations for introductions and market knowledge.
Good luck,
Your Aunty B
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