business strategies

Role of Business Strategy in Small Enterprises

Every business follows its business strategy for making their business perfect in market. This role of business strategy in small enterprises will improve your business strategy concepts and you will explore the topic of role of small enterprises business strategy. The business needs to follow an effective strategy to survive in market competition and making a brand. The role of business strategy in small enterprises is for making the business a good reputation in market. The strength of the company lies in its original and new concept and that it has been able to stick to it despite various product scopes that it can explore. The company followed business strategy which involved minimal capital investment and instead of opening a physical store right away, they decided to promote and market their product online. The use of new technology worked in the favour of the company as they were able to target the right audience to sell their hand stitched leather satchels. Being handmade, the product stands out for being unique and this is the company’s differentiation factor which puts it over and above its competitors, although not in capital size, but definitely in product offerings.

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The product is differentiated on the basis of its various colours, designs, albeit following the same pattern and giving a trendy look which started commanding cult following from fashionista across the country. Its competitors did not offer a unique or a creative product which the company was offering and hence it became unprecedented and established itself as an innovative and trendsetter firm. The owner handpicked choicest and handful of talented workers and employees and the strategy helped hiring of elite employees that helped contributing the increase in production and sales. However, the company has a very limited scope in production and limited capital. Buying raw material from the UK is expensive and raises the cost for the company when it can outsource some of the services to cheaper countries. Although internet helped boost the sales for the company, it also opened new opportunities for cyber crimes in order to hawk counterfeits. Fashion is constantly changing and therefore the company cannot keep selling just one product because the product development phase will reach maturity level as well. Hence, infusing innovation and creativity in expanding their product line will open up new market segments for the company. New trend attracts mass following when it is backed properly by creative innovation which matches the needs and demand of consumers and any wrong step in changing the product line may have negative effect on the brand positioning of the company. There are chances that the company may not be able to reach a wider consumer base as it has started to come to terms with new twists and innovations required to adapt to changing fashion trends. Fashion continuously gets evolved and there is always a high demand for trendsetting products and the satchel, when it reaches its maturity phase, may lose out to something else in setting a trend or uniqueness. The company hasn’t expanded its operations yet launching innovating products which targets bigger audience can work in the favor of the company for it to survive in the long term. Evidence suggests that SMEs don’t last more than 7 – 10 years in operation unless they continue with the innovative streak. The company has limited resources and they need to utilize them properly through online marketing to reach to wider domestic and international market.

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