Do you know which region of the world had the highest overall economic activity growth this year? If you guessed the United States, you’re wrong.
In 2019, South Asia, East Asia, and the Pacific held the top three spots for economic activity. That’s one reason so many US-based companies are eager to launch into foreign markets across the world.
But starting a business on your home soil and expanding overseas is very different. Read on to learn what you need to know about going global.
Are You Ready?
Before you expand to foreign markets, make sure that you and your business are ready.
You need to look at your finances and see if you have the funds to support and sustain the expansion.
Keep in mind that global growth won’t be immediate so you have to have a plan for that.
Also, think about whether it suits your business to gain a solid customer base internationally. Products that sell well in your country may not appeal to people elsewhere.
Take some time to explore if there’s a market for your product.
Is there a need for it? And if so, are foreign customers likely to purchase it? If there is a similar domestic product, why would consumers purchase your foreign product instead?
Don’t expand into foreign markets without being sure that the market will be receptive to your product or service. This means you must do a fair amount of research into the country.
Then, you can move forward with the rest of these tips feeling confident that you can succeed.
Develop a Global Growth Business Plan
To expand to overseas markets, you need to develop a detailed strategy that factors in economic, cultural, governmental, and market conditions.
This international strategy should fit within your overarching corporate strategy.
Define your strategy. Break it down into short, medium and long-term strategies. Set actionable and reasonable goals so you can measure your progress along the way.
It’s also important to define your success metrics and objectives. Then, figure out if you need a new company, a branch or a sales office in the new country.
Your business plan should also include a project plan with commit dates and a top-down annual budget.
Get the Help of Experts
Going global is not something that you’ll be able to do alone. Rely on experts to help you get through the process, especially in the early phases.
Find people that are experts in your foreign market and rely on them to guide you.
Get the Proper Infrastructure in Place
When you expand into foreign markets, it’s imperative that you put the right infrastructure in place for a successful launch.
You will need a local management team that you can rely on to run your operations overseas.
You must figure out if business decisions will be made locally or from headquarters. Then, consider practicalities such as IT and telephone systems.
Think about how your satellite team will share data in a secure method.
Prepare Your Product
The best infrastructure in the world won’t help you succeed if your product isn’t ready.
You need to focus on getting your product market-ready in the foreign markets. This means finding out if there are regulations (either industry or government-imposed) that you must adhere to.
You will want to have a patent and trademark review.
In some parts of the world, competitors rip off new ideas and make their own version. Often at a bargain price. You want to avoid this at all costs.
Have quality assurance and testing in place that adheres to local standards. And think about logistics such as distribution and shipping.
Learn About International Compliance and Regulations
Before expanding into overseas markets, you must dig into all the compliance and regulatory standards of your new markets.
Compliance can be a big challenge for many companies looking to become an international company. Take your time and get help with these issues.
Learn the different tax codes, packaging standards, and business regulations.
While some foreign banks will deal with a U.S.-based account, not all will. It might be necessary for you to set up a foreign business entity so you can get a local bank account.
Prepare for Language and Cultural Differences
No one will do business with you if you can’t speak their language.
It’s imperative for your global growth that you get accurate, professional document translations. You should also be ready to hire or partner with native language speakers to support your customers.
A local employee can also give insight into the many cultural nuances that may impact the market.
Establish Relationships with Local Businesses
Part of appealing to foreign markets involves relationship building with local businesses.
Research to find local companies that offer complementary products or services. These relationships can support the scaling of the organization while minimizing monetary risk.
Plus, you’ll gain important contacts in foreign markets. These can help you as you look into alliances, distribution partnerships and so on.
Final Thoughts on Going Global
As you can see, expanding into an international company requires an extensive amount of attention to detail. It will not be easy.
But for most companies, going global offers unparalleled opportunities for growth and success. As you focus on getting your plan and infrastructure in place followed by an understanding of the foreign markets, you can succeed.
Come back again for other posts that relate to your business.
