[Column] Development of New Businesses (2) The Principle of Entering New Businesses is the Bamboo Grove Method

I would like to introduce a column article.

The bamboo grove method literally imitates the way bamboo grows as a thicket. It focuses on the current industry or sector one belongs to and considers related industries and surroundings. It also involves assessing whether there are promising business opportunities that can utilize existing human resources, technology, sales channels, buildings, and equipment. In other words, like a bamboo grove, it involves developing businesses that are related and branch out from a single root. This approach is low-risk and does not lead to significant failures. The points to keep in mind in this case are as follows: (1) Develop based on areas where strengths and expertise can be leveraged. (2) Determine if idle assets (land, equipment) and human resources can be utilized. (3) Assess whether the industry planned for entry is a growing sector or a niche area that large companies do not venture into. (4) If entering as a latecomer, investigate whether the leading competitors in the same industry are generating profits. (5) Consider whether there is potential for synergy with the main business. (6) Evaluate how far human resources and investment can be utilized. (7) Identify assets such as land, buildings, and employees from previous businesses that can be leveraged. Exploring the possibilities of upward, downward, and lateral expansion based on this bamboo grove method, centered around the current business, is fundamental for small and medium-sized enterprises in developing new business ventures.

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