Taking your brand overseas can be appealing, and many entrepreneurs and business owners would jump at this major opportunity for growth.
Between establishing a fresh customer base, learning new laws and regulations, finding trustworthy partners, and becoming familiar with the local customs, the road to becoming a global company is difficult to navigate.
Benefits of international expansion
Before we offer tips to expand your business globally, we provide advantages presented by successfully growing internationally:
- You can expand sales of products and provision of services into new markets
- You can reduce your dependence on current markets
- You can reduce the effect of fluctuations in your current market on your business
- You can embrace global technologies and know-how
- You can compete with the best in the global market
We offer tips to get started with the process of expanding your business internationally.
Are you ready?
One of the first questions you must answer is whether your business is actually suited to succeed in international markets. It is important to ask this question, because scaling across borders is complicated and expensive regardless of a company's size, and the process can take time and resources away from other opportunities. Take a look at finances and honestly ask yourself if you have the funds to support the initial investment and sustain the growth you're forecasting.
Develop solid foundations
Before thinking of expanding internationally, ask yourself if your business has a solid local foundation. Consider whether you have enough resources and team members to maintain your current customer base and to manage an overseas expansion. For a business to sustain itself on a global scale and across cultures, you need a team that understands the brand.
These are not typical employees but rather human assets who have been hired for their ambition and vast entrepreneurial potential. These are change-makers and social innovators who see what you see, and will be ready to push things forward to accomplish your vision. With a solid team, you can then forge a strong vision to ensure you have the financial and structural stability locally and in due time set sights for expansion globally.
Do your research
Make sure you do comprehensive research about the market you want to expand to. This will help you decide whether your business can survive and eventually thrive in specific cities or countries.
Consider culture and customs, political and economical situation, spending habits, entry requirements, business environment, foreign trade, and the availability of the talent and skills you require. Also make sure you learn about legal and tax issues as well as regulatory and employment procedures and practices.
Researching your target market and local competition will allow you to know if your company, products and/or services are of any interest in the country you aim to expand in. It is important to note that a product or service that performs well locally, may not have the same appeal in foreign markets.
Consult global experts
Consulting with experts in the cities or countries you want to expand to can help you better determine the demand in that market.
Many governments and organisations support investing abroad by providing businesses with advice and assistance. Make the most of any help you can get from embassies or consulates, local chambers of commerce and industry trade groups. Many countries have set up government funding programs to support business international expansion. Determine if your business qualifies for government support.
In addition, it could be useful to consider training. Enrolling in a training program such as export or foreign trade courses, can be an effective way to gain extra global expertise.
Choose the right business structure and do due diligence
Knowing what your goals are is the key to selecting an adequate business structure for expanding abroad. Depending on the legal structure you choose, tax rates will be different. Furthermore, administrative procedures also vary from one country to another. Study each possibility so that you can make an informed decision.
In addition, depending on your business and the country you aim to invest in, you might need to complete extra tasks such as setting up a bank account, applying for visas and/or work permits, and registering a trademark abroad.
Choosing the right strategies to expand globally will depend on the type of business you own. Remember to always do your due diligence when working abroad. Global expansion is a big decision and a challenge. It requires time and appropriate business assessment before moving forward.
Penetrate markets effectively
Penetrate the market with your brand by using the right technology and marketing strategy to bring about a local brand presence. With the widespread use of technology and social media, you can reach global coverage without necessarily incorporating into that country.
If budget is a concern, focus on a specific area, such as one city, to expand into, not an entire country or continent. This will help you develop local brand recognition before expanding further and spending too much money.
Hire and train employees
International growth will require changes to human resources management. You will either be hiring employees or sending staff abroad.
You will need to establish a local office and team that understand the market and language to comply with local regulations. If you are sending employees abroad, you will also need to provide them with training, such as cross-cultural training and foreign language courses.
Furthermore, it is important to protect your employees and ensure their safety abroad. You will need to find the right insurance solutions to protect your business as well as your employees.
Be willing to learn and make changes
In any new venture, be prepared for some bumps in the road. That may mean changing how you operate in some ways.
You’ve spent time, energy, and money on building your business, you should be able to redirect your current resources towards your new goal. Don’t be afraid to pivot. A pivot means changing the direction of a business when current products or services aren't meeting the needs of the market. Read our blog post about pivoting your business successfully here.