What to Consider Before Taking Your Business Global
Mar 25, 2019

If your business is a success in your home country, it’s natural to be curious about the possibility of taking this success to the next level with global expansion. Companies which manage to do so open a whole new world of possibilities for their business’ potential, but not every business has what it takes. Business decisions are always fraught with risk and complex issues, but international expansion is a unique undertaking that you should not walk into blindly. Before you take the leap, here are some potential challenges you should consider before making the final decision to go global.

1. Is There a Market for Your Product?

It’s a simple one but a big one, is there an audience for your product or service? Trying to move your business into a country where there is no demand for your product could be a catastrophic waste of money and time. It’s not enough to think your product is needed; you need to do your research and base your business decisions on facts and data. On the other hand, if there is a demand, is it already being met by other companies? Make sure you can offer something unique and if you can avoid saturated markets.

2. Are There Cultural Differences or Language Barriers?

What language is spoken in your chosen country? If you don’t have the ability to communicate this could be a big stumbling block. You have the option to learn some key elements of the language, or you may need to hire a translator or bilingual member of staff. Another option is outsourcing customer service to somewhere which can communicate with your new customers. Learning the language or at least the basics will mean that you can build stronger relationships with new clients and/or distributors. Obviously, there will also be differences in currency and trade processes to get to grips with.

In addition to language barriers, you need to consider the potential for cultural differences. Your new customers and business partners may be used to conducting business in a different way. In some countries, business transactions are very simple and straightforward while others expect a degree of ‘small talk’ or socializing as part of the business relationship. You don’t want to offend simply by being unaware of any business traditions or customs that may be important to others. For example, it is customary in China to bring a gift to a business meeting. The gift will be refused by the recipient several times before being accepted.

3. Do You Understand Legal Regulations and Tax Codes?

There will be new business regulations and tax codes as well as trading standards to meet. You may have to set up a foreign business bank account to deal with your transactions as foreign banks may be reluctant to deal with a U.S based account. Packaging requirements will also differ from country to country, and you may need to translate the wording into the country’s native language and possibly several others.

4. What’s the Local Competition?

If there is already a product or service like yours in the new country, you need to work out your USP. Why would local people choose to buy from a foreign manufacturer a domestic one? Is your product of a better quality or offering benefits that others do not? It may be that being a US manufacturer would be an advantage, but you’ll certainly need to win their trust. If possible, you should travel to the country and visit attend some relevant trade shows.

5. Consider Online Ecommerce

A potential way to sell products globally is with an international ecommerce platform. These enable you to trade with the same efficiency as you do in your home market as well as providing you with insight into all elements of the sales process. A multi-channel ecommerce platform will help you to tailor your sales approach for different languages, currencies and even seasonal trends.

6. How Will You Arrange Shipping and Distribution?

The efficiency of your shipping and distribution is crucial to global expansion. You may want to partner up with a company in the county as they will have experience in the nuances and processes involved. This may also help potential customers to have more faith in your brand. Logistics is a complex subject even in your home country, so before taking the decision to go internationa, you should consider finding some further training or even a degree in relevant business disciplines. For example, you can study for an MS in supply chain management online which includes modules on global shipping and leadership.

7. Do Your Need to Rebrand?

Will your new customers respond to your brand and product ideas, or have they been designed with your home customers in mind? It may be worth doing some rebranding which is largely consistent with what you have but incorporates elements which are more appealing to the new market. What is humorous in your country may be offensive in another and vice-versa. The sourcing of materials may be important here as you could significantly improve your margins and the reliability of the supply chain by using local suppliers and supporting the local economy.

8. Have You Done Your Due Diligence?

If possible, you should always visit the country you intend to sell your product in. This will enable you to see first-hand how your business may fit in with the culture and existing market. You’ll also be able to do some research into your potential competitors and how they market their products. Do as much research and analysis as you can, consider all the worst-case scenarios and how you would tackle them if they happened.
Should You Expand Your Business Internationally?

Despite all these considerations and hurdles, expanding your business internationally is still an exciting time. Finding new markets is a great way to extend the sales life of your products and helps to protect your business from unpredictable demand cycles and seasonal shifts. If you take a pragmatic and realistic approach based on a foundation of evidence (not assumption) that your business has the potential to succeed internationally, it could be the best thing you ever do.

Photo by Dan Gold on Unsplash