In today’s market, it’s nearly impossible to take your business to the next level without global immersion. A few advantages of expanding internationally include selling existing products to a fresh market, embracing innovative insight and increasing your company’s competitive advantage.
If you’re ready to become an international business leader, there are crucial steps to take to secure success and reap the benefits of a fruitful transition. Here are our top five DOs and DON’Ts for international business expansion:
Do’s for International Business Expansion:
DO feel comfortable in the country.
You’re going to encounter cultural and language barriers. It’s important to understand the basics before you enter the new market. In an article for Entrepreneur.com, Christian Gaiser, CEO of Bonial International Group, explained how these barriers prohibit business owners from completing deals if not properly understood.
“Phrases like ‘it’s great’ or ‘we like it’ are often used in a meeting but they didn’t necessarily mean that we were close to a deal,” Gaiser wrote.
It’s also important to feel comfortable and secure in the new country because you’ll be spending copious amounts of time inside the new market once you expand.
DO Have a Trusted Team in your Target Country.
As mentioned in a previous blog post, it’s important to have a solid team lined up inside the country you’re entering. Having a solid team you trust makes the global transition seamless. This team includes HR leaders, marketers, accountants and legal professionals. It’s best if the team members are native to the country and have a complete grasp on the unique aspects of the market.
DO Understand the Laws for Doing Business Overseas.
It’s not necessary to hold a law degree and memorize all the legal codes. But, you should have a basic understanding of the legal complications involved with international business.
Tyler Rauert, a partner with Polaris Law Group, covers a list of important laws to learn in our post, International Business Law; Understanding the Legal Aspects of Doing Business Overseas.
DO Update your Business Plan for Global Expansion
Even if you have a solid business plan, you need to update it with the factors for international expansion.
According to Forbes, businesses need to include updates for potential markets and their customers, import and export strategies, updated revenue sources, added costs for marketing, shipping, travel, etc., international legal requirements, potential partnerships and investment opportunities.
DO Consider your Competitive Advantage
When you expand globally, you need to consider the competitive advantage. Is there one? If there isn’t, how can you create an advantage? Most businesses will find a competitive advantage from global expansion, particularly with increased resources and innovations from new environments.
According to MIT, businesses that expand into global markets “create and sustain their international competitiveness through a systematic process of exploiting, renewing and enhancing their core capabilities.”
Don’ts for International Expansion:
DO NOT Ignore Free Money
Mike Shanley, Founder & CEO of Konektid International, wrote a guest post for Velocity Global and discussed emerging in the international marketplace. One point he discussed is exploring your options for free money:
“Governments and multilateral banks invest $150 billion into developing opportunities in emerging markets every year. Too often, businesses see these investments as charity and not a business opportunity. So, they miss out on leveraging these resources to accelerate their market entry process,” Shanley explained.
Explore your options before investing your own capital.
DO NOT Assume your Intellectual Property is Protected
Before you enter a new market, create a strategy for your company’s intellectual property rights. Determine how your IP is protected and how you will enforce these laws if violated.
DO NOT Expand Without a Local Liaison
Much like your trusted team, you need to entrust a local liaison with your business strategy in your target market. This liaison can take the reigns when you’re not in the country and manage your in-house team abroad.
This liaison should be a highly trusted resource who you’d allow to make new business deals and handle secure information.
DO NOT Use the Same Market Strategy
Before expanding globally, research your target country’s market techniques and fully understand the culture. What works in your home country may not work in the new country.
When you’re expanding into a new territory, market strategy plays a huge role in your success. If you take care of the research prior to your expansion, you’re more likely to create effective initiatives that drive growth and ensure long-lasting success.
DO NOT Start From Scratch
Thanks to experts like Velocity Global, you don’t have to worry about building your international model from the ground up. Allow resources to assist with funding, entry, exit and hiring techniques.
