Entering new sectors is essential for growth and resilience, if growth is not going to be achieved by geographical expansion or acquisition of additional clients in sectors a business already operates in. However, diversification requires careful planning, strategic decisions, and the collaboration of multiple roles within the business. In a large business this process is carried out by many different people; in an SME, some elements may need to be outsourced as it involves many skills and is time consuming.
Step 1: Market Research and Feasibility Studies
The journey begins with thorough market research. This stage involves analysing market trends, client demands, and competitor activity in potential new sectors. PEST and SWOT analysis help assess risks and opportunities, and feasibility studies determine whether your existing skills, resources, and accreditations align with the requirements of the new sector.
Step 2: Strategic Decision Making
After identifying viable sectors, the senior leadership team must make the final decision on whether to enter. They assess factors such as alignment with the company’s strengths, potential return on investment, and long-term strategic goals. The Financial Director plays a crucial role by evaluating costs, potential profit margins, and any necessary capital expenditure.
Step 3: Skills Assessment and Training
Entering a new sector may require developing new skills. A skills gap analysis helps determine whether the current team and suppliers have the expertise needed, or whether new talent needs to be hired and training programmes arranged.
Step 4: Marketing and Networking
Once the decision is made, marketing becomes essential for raising awareness of your new capabilities. Physical collateral such as brochures should highlight past projects and new sector expertise. Digitally, your website should be updated with new services and case studies as they become available, while LinkedIn campaigns can share project updates, sustainability initiatives, and client testimonials.
Step 5–7: Lead Generation and Building Trust
Lead generation platforms like Glenigan, Barbour ABI, or Builders Conference help identify upcoming tenders and key decision-makers. Building strong relationships with clients and their advisors — including architects, engineers, and quantity surveyors — is essential for gaining a place on tender lists. Client testimonials, case studies, and relevant accreditation credentials reinforce your ability to deliver in new sectors.
Step 8–9: Tendering and Bidding
Once relationships are established and the first tender arrives, the commercial and estimating team complete tender opportunities in the new sector. Bids should highlight cost-effective solutions, sustainability initiatives, and adherence to sector-specific regulations to secure the first contract.
Step 10: Project Execution and Feedback
Successfully delivering the first project in a new sector will not only enhance your reputation but also increase the likelihood of securing repeat business and referrals. Images during construction and post-project feedback from clients and their advisors are invaluable for showcasing capabilities. The advisors ideally become advocates who the business development team can introduce to potential new clients.
