by Taylor Ryan
Once you have established a successful business in your home country, the next logical step would be to continue expansion abroad to grow it. No matter where your startup company is from and no matter how large your local market there is always the opportunity of tapping into billions of potential users and clients on an international scale. Expanding your startup internationally may just be the right strategy to take your business further.
There are many challenges which you must be willing to face in this process. Going for an international market means there will be cultural differences, language barriers, staffing hurdles and marketing issues that you should be ready for. There are plenty of things you must consider in order to ensure you and your startup are ready for the next level. You must find out whether there is a significant potential customer base, which you can tap into because your product may be popular in your home country but may not have the same appeal abroad.
Challenges in expanding internationally and how to overcome them
according to Michael Lee, who is the head of the International Marketing and Business Development at Alibaba.com, an e-commerce platform, the best way to enter a new market is to go for one that is similar to your own. Even though it is not identical, there will be some degree of familiarity in running your business there.
He also recommends that various factors must be taken into account, such as the currency, culture, trade barriers and proximity. Moreover, the local competition must also be considered as there may already be an established brand that you will compete with. The likelihood of this is very high. So do your homework!
Do your homework right
Do the market research and do it right. Don’t go easy on this part or it will definitely come back to bite you in the rear. One of the basic aims is to figure out whether there is sufficient interest in your product or service in your target market. Additionally, you need to know how strong and established the competition is and find out the market saturation level before you launch your own product. This will help you do something different with your product to give a competitive edge.
Learn the language
Learn the language of the country you are venturing into. It is always an added advantage when you can speak to your customers, suppliers or business partners in their own language. This way you will not feel like an ‘outsider’. Does this sound a bit extreme to you? Fear not. That’s what a solid team is for. You’ll have to invest a bit of time to find someone who has knowledge of both languages and of the ecosystem too. But they are out there.
Build a strategy
No matter what type of a business you have, you must have a business plan and strategy in place, which you can apply to the foreign market you are willing to enter. Having a comprehensive business plan and strategy will help your business achieve sales, create a brand name for itself and be successful. The business plan should include the vision of the business and the goals, which you aim to achieve in the international market.
Use the right technology
Having the right technology will go a long way in your international business venture. It will help you to stay in touch with your business in both the locations, at home and abroad. It will help you to keep track of your shipments, your sales and provide more regular contact. The right technological resources will end up saving you time and expenses.
Ensure you have the right resources
When you do decide to take the leap, you should ensure you do have the right resources in order to run a business internationally as well as manage your business locally. This includes manpower, finances, and technology among other factors. You should ensure that you have somebody reliable to run the show back home when you are traveling back and forth to the new international location
Pay close attention to the local culture
Your business, no matter how successful at home will not do well unless it takes into account the local culture and values of the new country. No matter how great your product or how well liked it is by the customers, it will not last long if it offends their cultural values. The same goes for running the internal business abroad. Unless you take into account the values of the employees, you will not be able to establish a strong team of loyal individuals. As such, you must pay close attention to their culture and values.
Find a team or a partner
It is always good to have a partner or a team when you decide to enter a new market in another country. Whether the partner is simply a mentor, it should be somebody that you can trust, who believes in your brand or your product and who can vouch for you. It is also important for that partner to have experience in that local market and the capital which you may need to grow. Moreover, the people which you hire in your overseas venture must be fully involved in your business and should have your best interests in mind. It is not a good idea to enter a foreign market without having any local business contacts or a local team which possesses the necessary language and know-how of the country.
Have a lawyer
Yet another important factor to consider is getting a lawyer when you decide to expand abroad. The process of expanding into a foreign country is not easy and every country has their own rules and regulations. Getting a good attorney who can handle all the paperwork which can be lengthy and slow is crucial. Your business will also require smooth transitioning into the new country and a local legal representative can definitely make the difference in a smooth business launch.
Maintaining company culture
One of the challenges that comes from expanding internationally is how to maintain your company’s culture across the cultural barrier. It is one of the trickier points that you must focus on as it should be maintained, especially if it is dispersed over a large geographical area. For this reason you should focus on hiring people who have strong communication skills and functional expertise.
Impact of new ideas
You must consider how the people in the new country will react to your business ideas. You must keep in mind the cultural and religious differences that the foreign country may have which will be a new experience to you and you must make sure you do not end up offending any of your business partners or employees with your usual business ideas. The best way to tackle this would be to adapt to the environment of that country while remaining consistent with your branding and product. You may need to adjust your sales approach though and slightly tweak your product in order to cater to the local taste.
Do your due diligence
Once you have considered a foreign country as a potential business venture, you must travel to that country in order to get the firsthand experience and the ‘feel’ of the place which can help you decide how the business will do. This will also help you to research and test your product in the new marketplace. Once you are there, you should also meet local partners, lawyers and other stakeholders which may be involved in your business. It is important to get to know people face-to-face even if it can be done remotely.
One of the factors which you must consider before launching your business is how the financing would be done. One of the popular sources of finance in the USA is the Export-Import Bank of the United States for the business which are expanding overseas. These types of banks provide loans to the exporters and credit insurance options as well.
Once you have done all possible research and your homework, then it is time to take the leap and take your business venture abroad. But even then, there is no guarantee that after strenuous research and long hours of hard work you will be successful. It is a harsh ecosystem to navigate, but it is also one of the most rewarding when done successfully!
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