Global expansion is a huge topic to boil down and simplify for businesses; it’s complicated at every step of the process with hidden speed bumps that appear at the worst moments. One of the great things about today is how easy it is to crowdsource information from your network to get a clearer picture. In this post, we did that for you to get a clearer picture of global expansion.
We asked successful international business leaders in our network the same question:
Taking into account all of your experience, what would be the #1 tip you would give to anyone looking at Global Expansion for their business?
Below you will find unique insight from international executives and directors of all kinds. The tips range from hiring strategy, executive strategy, partnership advice, and more. We list their tips here in the order that we received them (there is no rank) so make sure you go through all of them. Their great advice speaks for itself and is of immense value to anyone considering global expansion. We’ll let these experts take it from here:
My Number 1 tip is to hire someone who knows the market you are expanding into intimately; preferably someone who speaks the local language in addition to being fluent in both spoken and written English and American business concepts; someone who can bridge the differences in the local market business and social cultures and American business and social cultures; someone who can break through red tape and corporate inertia to get things done and achieve the company’s mission in the market.
Surround yourself around the best third party advisors possible in order to meet all compliance needs as well as minimize headaches.
Our number 1 tip after deciding whether or not your company really needs to go global: abandon all notions of how business is done or should be done. It will undoubtedly be very different in your destination country. Investigate, in person if at all possible, every aspect of doing business in that country…go native or find an in-country specialist who truly understands the territory.
When entering a new market, recognize that you are unconsciously biased toward local people who make you feel comfortable—they may speak and write English well and have adapted our social customs. This role of “bridge builder’ is necessary but not sufficient. It is very important that they also have the market knowledge and a network of relationships with the local business community that you need to build your business successfully.
In many markets—especially emerging markets—there is a sub-culture of local people who earn their living helping foreign companies set up and operate their businesses. If these people are not trusted and respected by the local business community, they will be unable to help you achieve your objectives. In the end, you will accomplish more by sacrificing some language and cultural skills and focusing on basic business capabilities. If you are committed to the new market for the long term, you can invest in building the language skills and cross-cultural fluency of your local staff, paid for by the profits of your successful business.
It is essential to understand the local market that you are entering and to have a strong local network. Your market entry strategy should be developed on the ground in your target market in collaboration with local stakeholders.
When going into a new country, start with a blank state, and a desire to learn. Put everything you know about your own country and assumptions about doing business aside. With an open mind and respect, realize many things are different; from how people think, the use of language, laws and regulations, the sense of humor, what people value, how to reach prospective customers, customs and culture, procedures for getting things accomplished, how time is valued, the importance of relationships, the value of money, the value of winning, and more.
The world has changed since Christopher Colombus entered international markets; join the modern way of expanding into foreign markets using Velocity Global’s Foreign Subsidiary as a Services (FSaaS) model.
Global expansion can be a formidable feat. Many companies attempt to undertake the daunting task of learning all the country specific regulations themselves, which ends up costing them more time and money. Companies should instead utilize streamlined solutions like RegDesk and Velocity Global, which provide quick access to vetted local expertise at low cost.
#9 & 10
1. Do thorough, exhaustive research about everything from culture and habits, social norms, legal and regulatory environment, business mores, political issues, etc. I’ve made this mistake myself and have seen many others make it. Research could have prevented major mistakes and saved significant amounts of investment money.
2. Hire expertise as early in the process as possible that is familiar with your existing environment as well as your target environment.
When companies look to expand internationally, it is important to understand that there are often markedly different business customs and cultural differences. Engaging local partners that understand these differences and can facilitate your ability to get up and running quickly is paramount to initial business success. Don’t underestimate the importance of leveraging a local entity that can make the international launch go more smoothly. Embrace the Value of Partners!
The cost and complexity of adding staff from other countries is higher than you might imagine. Velocity Global definitely made it easier (and quite frankly, possible), but be prepared to spend more time and money than you would hiring domestically.
Not all organizations who are expanding globally research all of their options before taking the plunge. There are so many options available to companies who are expanding, but due to lack of knowledge they sometimes make the obvious decision. This may lead to high costs and /or compliance issues.
Research, the global industry is shaping to be the most diverse area of expertise with companies launching new products almost weekly to deal with different areas of compliance and process.
The best word to ever use abroad is “why?” It helps you understand the society and why things occur the way they do. It also shows someone you care about why things happen in their country. 9 times out of 10 someone will get excited to tell you about their country and how they do things and you can use it that day and well into the future.
CEO at FDI Strategies, LLC<
Think before you act… Do your research, find at least three options to achieve your goal, and get full buy-in from your executive team before committing to international expansion. We see too many companies rush into global expansion without understanding the implications and get well over their heads quickly.
Understand the national, third country national and U.S. expats’ local labor market job pricing, benefits and labor laws.
My number one suggestion is to seek outside help! No one going global for the first time is expert enough to minimize the time and cost or to avoid all the pitfalls on their own. Whether it is business registration, employment, visas and immigration, accounting or payroll, there are expert firms available to help you learn, make decisions and execute quickly and effectively. You will find that enlisting the right help will help will keep you out of trouble and free to focus on the most important thing: your core business.
We want to thank every one of the professionals here that contributed to this post and of course if you have any questions, our doors are always open.