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It is common for equipment vendors to expand their operations. Some ways they do this are by opening additional locations in new markets, expanding their equipment offerings to meet their customers’ needs, and using innovative marketing techniques. In addition, some vendors acquire existing businesses to expand their reach.
If you are considering expanding your equipment vendor business and need inspiration and ideas on how to do it, read this Balboa Capital blog article. It covers common expansion strategies to help equipment vendors stay relevant, competitive, and profitable.
Expand your range of equipment options.
When you offer more than one type of equipment, you can meet varied customer needs, set your vendor business apart from competitors, and increase sales. Let’s take a business software dealer as an example. Realizing the growing demand for niche software applications, the owner expanded their product offerings to include specialized software for business security, graphic design/3D modeling, supply chain management, e-commerce, and marketing automation. This helped the software dealer attract new customers and boost loyalty among existing ones who welcomed the latest options.
Diversifying the selection of equipment is a well-established and practical approach to expanding a vendor business. This strategy has been shown to drive business growth and increase opportunities for success. You can do this by identifying types of complementary equipment to offer and then contacting the manufacturers and distributors to place orders.
Enter new geographic markets.
Expanding into new geographic markets is an excellent way to grow your equipment vendor business. This is especially true if the markets are untapped and lack equipment vendor businesses. Before you move forward with a new business location, you need to uncover the potential demand for the equipment you sell. You can conduct market research online using free resources from the U.S. Census Bureau, the U.S. Bureau of Labor Statistics, and the North American Industry Classification System (NAICS).
You might decide to proceed if your research reveals an opportunity based on the market size, number of businesses, and growth rate. It is important to remember that if similar equipment vendors are already established in the market you are considering, it might be difficult to capture market share. That said, it can be done with marketing that differentiates your vendor business and communicates your unique value proposition.
Purchase an existing equipment vendor business.
Building a vendor business from scratch can be difficult, especially in a competitive market. That is why some owners buy existing vendor businesses outright. When you purchase an established vendor business, you’re not just acquiring physical assets; you’re gaining access to a loyal customer base and established manufacturer and supplier relationships.
Finding an equipment vendor business for sale by its owner can be a challenge. There are several reasons for this. For starters, vendor business owners who are satisfied with their operations prefer to keep running their companies rather than sell them. Next, many owners decide to sell their businesses when they are about to retire. Lastly, owners may transfer ownership of the vendor business to their family members in the future.
If you want to purchase a vendor business, you can contact a local business broker and ask them if any are for sale. If so, you must conduct due diligence to learn how the business is performing financially and hire a business attorney to assist with the transaction.
Promote your equipment vendor business.
Your equipment vendor business must attract customers so you and your sales managers can close deals and drive profits. To do this, you need to get the word out about your vendor business. The good news? It’s now easy and affordable to promote your company. Start by registering your vendor business with Google by creating a free Google My Business account. You can include important information about your business, such as its address and hours of operation.
You can also promote your vendor business on social media, in a newsworthy press release, and by participating in trade shows and local and community events. Of course, you must have an informative and fully optimized website highlighting your business and equipment offerings.
Revamp your equipment showroom.
Some business owners seeking the equipment your vendor business sells are researching your company online. If they like what they see, they are more likely to visit your business in person. When they walk through the door of your vendor business, how they perceive your showroom can make all the difference in the world. Simply put, a clean, organized, and well-planned showroom helps create a sense of trust and reliability. Moreover, it can enhance the equipment buying experience and help you move inventory.
Take a look at your showroom and lot to see what can be improved. If needed, arrange equipment and displays in a sequence that guides customers through your showroom. Next, remove any clutter and ensure your showroom has good lighting. Finally, always keep your floors and furniture clean and free from debris. These small tasks can have a big impact on your customers.
Finance your expansion efforts.
When aiming to expand your equipment vendor business, it is vital to consider the financial aspect. The last thing you want is to move forward with an expansion effort without proper planning or the required growth capital. Depending on the size and scope of your expansion plan, you may need to secure external funding, such as a working capital loan or equipment financing. Balboa Capital, a division of Ameris Bank, offers both of these funding options, and we have competitive rates and flexible repayment terms.
Balboa Capital is not affiliated with nor endorses the U.S. Census Bureau, the U.S. Bureau of Labor Statistics, the North American Industry Classification System (NAICS), or Google. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.