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We live in an increasingly globalized world. The growth of transportation and the internet has made it easy to engage with people, clients, and businesses from all over the world. International expansion is a question on the mind of businesses of all sizes, big and small, but actually navigating global growth can be difficult and intimidating. What are the new laws and regulations that you need to learn? What are the local customs? Read on to learn how to expand your business across borders.
Ask Yourself If You’re Ready
Before you start strategizing or making plans, ask yourself if your business is even ready for international expansion. The process itself requires a heavy investment. Even if you think your service or product will do well in an overseas market, there is no actual guarantee that it will, meaning you could end up sinking a lot of money into a lost cause. Furthermore, scaling your business across borders will inherently take resources and time away from other ventures, opportunities, or internal improvements.
The right time to expand to foreign markets will vary based on a wide range of factors and variables within your business. Determining the right time usually involves a great deal of analysis for due diligence and building a comprehensive international expansion strategy and business plan. Evaluate your finances and determine if you have the money to sustain your global growth while supporting your initial investment. If you can, it might be worth the gamble, especially if you know that you can build a customer base in the new market. Otherwise, wait and invest in your existing operations before expanding to foreign markets.
Building the Right Team
If you do think you are ready to proceed with international business expansion and have performed the necessary due diligence, start your expansion by building the right team. Too many companies try to start with executives of the parent company, but it’s best to spend the time building a local team that understands the target market, including the local culture and language, as well as the local regulations. This team or partnership can act as a type of mentorship to guide you through the cultural differences that may spring up during the business expansion process. At the same time, your local employees should have your best interests at heart.
Develop the Infrastructure
Along with your team, build an infrastructural system that ensures smooth new market entry. This could include a satellite office that allows your management team to deliver strategy and maintain communication. Determine what the local employees can decide on their own and what decisions need to be made centrally.
Fortunately, communicating with an overseas team is no longer difficult, thanks to solutions for cloud computing in business. The benefits of digitizing documents include the ability for your employees to securely access files from anywhere in the world.
Prepare Your Product/Service
Work on your product or service so that it is market-ready. Much of that comprises reviewing regulations specific to the industry and the local government. You may also need to review testing and quality assurance to meet the standards of the local market. Patents and trademarks may not carry over across different countries’ borders.
You generally don’t need to make any significant changes to the product offering, but you should determine if the packaging requires any localization or translation. You may need to reconsider local logistics and determine your distribution networks and supply chains.
Establish Your Market Strategy
Even if your product is well-known in its home country, it’s good to develop a comprehensive market strategy that addresses all the specific factors of the local market, including:
- Value propositions
- Pricing models
All of this together will create some clear elements to differentiate your product or service in the target country.
Establish Legal Process
Different countries can be more litigious than others, and the laws will always be at least a little different across any border. Establish strong and comprehensive legal processes that can minimize commercial risks while protecting you and any potential clients. Most government agencies also require legal documentation, which you should have ready well before you actually set up any operations within the new country. Having an online contract signing solution in place will allow you to easily send and sign important documents across borders. These proactive legal efforts typically require a bit of an upfront investment, but this money will offset any risks or liabilities that may sprout up later on.
Taxes and Finances
Similarly, taxes will work differently across borders. Build up the proper tax and finance infrastructures that ensure that you are adhering to all local corporate policies and procedures. Setting up your finance infrastructures sooner than later also allows for timely and accurate reporting.
Work with Local Businesses
No company exists in a bubble, and working with other local businesses can give you a strong competitive advantage. You can create a positive, supportive ecosystem with other companies that complement your own products and services. This can lead to future partnerships, alliances, and business relationships. These local businesses can also show you the ropes and expand your own client base.
Successful international expansion can come with plenty of roadblocks, but it is also an incredible adventure for everyone involved. For additional information, let one of our dedicated MRC associates share how Xerox® Workplace Assistant can help you achieve your goals.