Expanding a business overseas is challenging. You have to learn and understand cultural differences and a number of other nuances. Before committing to a new country and invading its markets successfully, you need a plan.
Are you planning to expand your business? Going global is a good idea especially if your business is performing well in its home country. In addition, global expansion offers more growth opportunities. However, entering a new market is easier for a trader online but not for a business.
Before we dig into how to make the expansion successful, let us have a look at the advantages of going globally:
• Extend the sales of existing products and services by finding new markets
• Reduce dependency on the market you have already developed in your home country
• Stabilize our sales by tapping into new markets in case of seasonal changes or demand cycle within your home country
• Exploit the corporate technology
• Get experience on how to compete against foreign companies
Chances are you have thought about entering the global market already but have not worked it through because let’s face it, success doesn’t come easy. Perhaps these tips might help:
Prepare Yourself with These Questions
Debuting your business in a foreign land is risky. Success is not always guaranteed but you can certainly prepare yourself. Start with these questions:
Will it sell in the target culture?
For that, you will have to do market research. For instance, if you are selling dairy products, you must make sure your target market is not lactose-intolerant.
Is your target market familiar with your product/service?
In case they are not, you will have to spend time and money in educating customers. If you have introduced a new concept, the product would then become synonymous with the name of your company.
Are you familiar with the culture and language?
You will probably have to live in the country temporarily. It is important that you have knowledge about their language and culture. This will help you blend in more.
In case you do not get the right answers, that does not mean your idea is poor. It just means you have picked the wrong market.
Check the Historical Data for Economic and Political Stability
An international live trading market may have a history of cyclic changes that can dramatically increase risk or even cut a business opportunity. If you not aware of them, you will suffer big time. The best approach is to study the historical data of the company for economic and political stability. Always have a backup plan in place to minimize risk if there is a possibility of sudden change.
Develop a Business Plan and a Sound Strategy
Each market has its own nuances and they are determined by the economic, governmental and cultural conditions. While developing a business plan, you must devise a localized strategy towards success. Your business plan must consist of the following:
• Define your short, medium and long-term strategy. The goals should be reasonable and measurable.
• Define objectives and success metrics.
• Do you want to set up a branch, sales office or a separate company?
• Develop an annual budget.
• Develop a tactical project plan along and assign dates.
Find Local Alliances and Partnerships
One effective way of expanding your business or make it grow in the new market is to join forces with another company located in the territory you are planning to enter. Find companies that might be interested.
Build Rollout Strategies with Local Experts
Strict labor laws and local barriers have hurt the business of Airbnb and Uber in the past. Early mistakes when entering a new market can tarnish your reputation, to begin with. Overseas legal counsel can be costly but consider it as an investment. It will help you avoid penalties in the future.
Be Legally Prepared
Some countries are very litigious. It is hence critical to have your legal documentation in place before operating in a foreign country. You must review the regulations in a particular industry to ensure compliance. Obtain all necessary certifications. Read about their immigration, customs, and shipping policies. All this preparation beforehand will keep you from risks and liabilities.
Build a Team
You are going to need team members for sure. The best approach is to hire locals with expertise in customer service, operations, sales, logistics, accounts and more. It is also recommended to hire an in-house legal counsel team to expand your knowledge in international law. Once you have hired the right people, work on team building. Value their opinions because it will be pertinent to the success of your venture.
Crawl, Walk and Run
You will have to crawl in the beginning. You can always start with e-commerce or reach out to distributors to make your way safely. Once you get positive feedback, then you will begin to walk. Forming a strategic alliance or getting a license might fall into this category. If your idea is a success, you never know a large firm might acquire your business. You will then be ready to run. But, you will need patience for all of it to work out.
Just like CFD Trading, expanding business globally is not for those who have a weak heart. No doubt with a well-thought plan and strategy, you can certainly cash on the opportunities for growth. Outsourcing administrative functions and paying attention to details can produce great results.