Starting a business from the ground up is no easy feat. It can take years to reach a stable point in your operations, whether you create products, offer creative services, or manage a team of experts.
Almost every new business owner’s dream is to take their company to the next level and reach more customers. Eventually, there will come a time when you’ve reached the potential to scale globally. Back in the day, this was such a difficult task to accomplish. It entailed flying in and out of different countries before you can operate.
Now, however, closing a business deal is much faster. With the technology this era brings, expanding your services and catering to an international audience just got more convenient. You’ll never get the legalities out of the way, but setting up meetings and outsourcing your staff has become possible. Such practices have allowed companies to ramp up their efforts in growing their business.
But before you completely embrace the digital age and dive headfirst into your dream of expanding your business overseas, it’s worth taking a look at some critical factors when it comes to going global. Below are a few.
1. Language, culture, and practices of your new market
In an ideal world, your product or services are universally applicable to all cultures and races. The truth is there are a lot of nuances when it comes to these aspects. You will have to study it properly before marketing and positioning your product.
As with the case of language, it will be beneficial if you can hire bilingual staff members, full-time translators, or outsourced an employee for that position to help you communicate properly with your new region. Understanding the cultural and lingual differences in a country is the key to penetrating their market successfully. Don’t expect that your promotional efforts in one place will work equally across the globe.
2. International compliance, laws, and regulations
There’s so much to study when you start operating on foreign soil to the point that it can be a bit intimidating. Things like tax codes, business regulations, packaging standards, and all the legal paperwork can make your head hurt, much like how it went when you were first setting up your business.
It can take months to set up your corporation depending on the requirements that each country, state, or city will ask for, so be ready for this challenge. It’s worth seeking help from business partners who operate in the same location. They can accurately illustrate the economy and business landscape of the country you’re trying to set up your company in.
3. Packaging, shipping, and logistics
If your business sells a tangible product, chances are it will be produced in one major hub or headquarters. This will then have to be transported to the countries you operate in—all of which have different requirements. This means getting a reliable partner who can process all the specifications according to its destination.
You would also need a business shipping container to transport your goods from one port to another safely—sealed, free from damages, and ready for sale. This adds to your overall packaging and production cost, as each country will have different demands when it comes to allowing you to sell your item.
4. Facing local and international competition
It’s safe to assume that your product won’t be the first of its kind to enter your foreign market. Perhaps the country has a local business running the same thing, or other international companies have explored and invested in the same place before you.
Study how they run things and how successful they’re currently doing so that you can benchmark your company’s performance. It will allow you to think of creative ways to surpass your industry rivals.
There’s also the case of earning the trust of your new market. Being a new player in the game will put you at a disadvantage in the beginning. But with the right analyses of trends, you should be able to see your numbers slowly rising.
5. The different pace of growth
Speaking of “numbers slowly rising,” it’s important to note that there’s no way to accurately predict how fast your company will click in a different country.
You may be doing so well in Asia but realize that the US or European markets are a bit harder to conquer. This is normal and doesn’t immediately spell out bad news for your company. Perhaps this means you should look into more ways you can position or market your product in its new location.
6. Increase in overall business operational cost
Financial gains and broader market opportunities are what encourage business owners to venture into global expansion. While this is true, keep in mind that the more places you operate in, the more money your company will bleed out.
Financial preparedness is necessary when it comes to taking the first few steps into going global. Up until your company finds footing in a new territory, you should be anticipating massive expenses that will be poured into establishing your company in a new location.
Knowing is Half the Battle
Familiarizing yourself with the different challenges that businesses encounter when it comes to global expansion can help you become more prepared for the time when you want to push forward with this strategy.
It can even be a good idea to visit and stay in the country you want to operate in to gather more info about the country. Before making any significant decisions, run them by your team and think of all possible outcomes, so you can better prepare yourself for emergencies or the unexpected fast pace of growth.
You can overcome these struggles with the help of reliable business partners and hiring team members whom you trust can carry out your business goals. It cannot be stressed enough that you can’t do this alone. Tap the help of your international business partners or locals from the area you wish to expand so that they can give you more insight into what your company may face.