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A SWOT Analysis of the US Retail Market

 

 

While working on your strategies to enter the US market you need to take into consideration all aspects of the market and make sure the decision you make is the most profitable for your business.

Although each industry is different and there are unique factors that influence the outcome, the following SWOT Analysis is meant to have you start thinking about the aspects that are most important for your business and how to best balance those factors.

 

Strengths

US market is the world’s largest homogeneous market; this opens your door to over 300 million people who, with some exceptions, will respond to the same marketing triggers unlike Europe where everything is fragmented and businesses need to customize their offer for each market.

 

Weaknesses

Retailers have and expect high margins as well as high listing fees for each SKU.

Entering the US market also involves high shipping costs which make it harder to compete on price with domestic suppliers.

Depending on the industry, regulatory compliance can be an obstacle in entering the US market and sometimes a long and cumbersome process.

 

Opportunities

Working with smaller retailers that have less stringent terms will allow you to learn more about the market and build a reputation before approaching the large retail chains.

However, the major retailers cover the entire market which gives your product exposure to a high percentage of the population.

The US is an “aspirational” market, getting your product endorsed by a celebrity will open many doors.

 

Threats

Although the market is huge so is the competition; this not only makes it hard to get on the retailer’s shelves but also to maintain a high turnover as consumers have more choices as well as less expensive private label alternatives.

The large homogenous market also means high advertising and promotion costs.

 

As mentioned above, this SWOT analysis should be customized for each industry as what might seem an opportunity for one company could be a threat for another. An assessment of your category should be carefully analyzed before deciding which markets to approach.

 

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