11 Tips for Entrepreneurs Looking to Expand Internationally
It’s common to find large global brands in countries the world over in the fashion, technology, or automobile industry. Now, even small to mid-sized businesses, entrepreneurs included, are finding ways to make the most of the quickly burgeoning international marketplace. If you’re thinking about expanding internationally, it is crucial that you pay attention to the basics.
For starters, don’t expect to ride on the success of your brand in your home country once you venture into a new territory. Bear in mind that even big names have failed when taking their enterprises to new shores. Examples, in this case, include Target’s dismal performance in Canada, and the troubles Best Buy and Walmart faced in China.
1. Select the right market
When you start looking for new markets, go beyond the tried and tested, but do not expect Eskimos to buy refrigerators.
While most American entrepreneurs who wish to expand globally usually look to Europe, Asia, and Canada, consider exploring other territories that have a demand for your products or services. For example, trade statistics show that the Indian subcontinent is a big importer of electronic devices, as well as precious stones and metals. Brazil, on the other hand, is a good market for pharmaceuticals as well as optical and photographic equipment.
2. Get a local perspective
Different cultural beliefs and shopping habits may have a bearing on how people from any region perceive your business. If you feel there is some kind of a divide, determine what you can do to bridge the gap early in the process.
Running a business is a long-term affair, so make sure you are comfortable in your new surroundings. Think twice about entering a market that needs to be extensively educated about why they might need your offerings because it can be a time- and money-consuming affair.
3. Study the competition
Is your idea so unique that it will not face much competition, at least at the beginning, or will it face stiff competition from the first day?
In the presence of strong competitors, you will need to direct a fair amount of money and effort to market your brand in the right manner. Are you prepared to battle it out for the first six months to a year? In addition, determine what you can do to distinguish your brand from its competition.
4. Develop your brand
There is no dearth of excellent business ideas that failed to deliver internationally, mainly because of poor brand positioning. When testing international waters, it is vital that you choose the right way to tell your brand’s story.
While you want your target audience to show interest in your offerings, you also want it to build some kind of a connect. As a result, pay due attention to how your company plans to position itself.
5. Get the right resources
The performance of any business that goes international depends on the people that are part of it. While a captain plays the all-important role of steering a ship in the right direction, there is no undermining the value of any other person on board. Unless you plan to shift base to a new territory, you will need someone to head the team locally. Hire someone who has knowledge of the local market, has the right kind of experience, and is passionate about your company’s goals.
Also, take advantage of technological tools hold the potential to simplify cross-border communication, track orders, and manage different kinds of paperwork.
6. Pay attention to building trust
Build a dependable and trustworthy team. Do not hesitate to run background checks as part of the hiring process. Let job applicants know about this in advance to keep the process transparent. Make sure you keep all communication channels open so you remain approachable.
As your business grows, you may need to look for more suppliers or vendors. If you started out by offering your products or services through an online marketplace and have graduated to interacting with your customers directly, rely only on third-parties you can trust.
Trust also plays a role with international customers. For instance, you may need a payment in advance but a customer might not feel comfortable in making a payment for a purchase from another country without having received it first. Look for ways to be transparent and accommodating without putting your business at risk.
7. Handle foreign currency exchange correctly
Businesses that expand globally have to deal with the exchange of foreign currencies, either when they receive payments from customers, or when they need to pay employees or suppliers. In both cases, choosing a suitable service provider may result in significant savings.
Some specialist money transfer companies provide multi-currency accounts for businesses, giving them the ability to receive and make payments as well as hold funds in multiple currencies. Two prominent names that offer such accounts are TransferWise and WorldFirst.
8. Understand local laws
Business-related regulations and laws surrounding taxation tend to vary from one country to another.
For instance, as an American entrepreneur, you will be taxed for all the income you earn worldwide, and you will be subject to a special set of reporting requirements. Regulations that govern packaging and labeling also tend to be region-specific.
9. Avoid corruption
There is no country where corruption is legal, and punishments vary from region to region. However, there are several countries where corruption remains rampant, and you might have to grease more than a few hands even before you get your show on the road.
10. Use geolocation
No matter which territory you choose, think about using geolocation apps and platforms to boost sales. These tools make use of consumer location and preferences to provide insight into their habits and desires.
Going this way gives you the ability to provide location-based offers, create sales territories, build value-based exchanges, and more. If you feel that leveraging large volumes of data is challenging, think about using the services of a professional.
11. Provide high levels of customer service
If you want your customers to have great experiences, your employees need to know just what your company expects from them. Great customer service is not just smiling and welcoming customers, it is about delivering on all counts, be it creating an interactive website or dealing with an unhappy customer. If you expect recommendations and repeat business, you have to strive toward creating satisfied customers.
Encourage your customers to write online reviews and reply to them quickly. Results of a consumer review survey suggest that around 85 percent of people have the same faith in online reviews and personal recommendations.
An increasing number of entrepreneurs are hoping to make the most of the growing international marketplace by expanding globally, although not everyone is tasting success in equal measures.
Do not jump on the bandwagon simply because others are, and make sure you have a thorough plan in place. Remember, even the best have to start afresh when in a new territory.