The internet and global opportunities have allowed any business to expand into an international market. As much as local success is astounding, a successful global market strategy can be thrilling.
It might look easy on paper, but if not well planned, a global market expansion can be a disaster without any Return On Investment (ROI).
Below are some tips on how to properly plan your business for the international market:
Evaluate your readiness
In truth, not all businesses are designed for international expansion. Before taking any step in this direction, be sure there is a problem in the foreign market that your business can competently solve.
Suppose you cannot find a problem in the area or discover another product already in the region that your business cannot outshine. In that case, you should check another country or region.
Present a unique offering
Identify your Unique Value Proposition. Your business must be able to provide something competitors on the ground cannot beat. This could be high quality or price. Most of the time, the offering that is likely to gain the attention of people in the target country would be determined by their purchasing behavior.
For some products, people prefer buying the cheapest as they are not concerned with durability. In contrast, some cannot sacrifice quality for price.
Market survey
After preliminary research and discovering your business stands a chance in an international market, your work is not done. It is crucial to get a live assessment of the situation on the ground, and one of the best ways to do this is via a survey.
You can have surveys in Spanish or any other language. It is essential to present surveys in the local language of your target market, as it is easier for people to express their thoughts in local dialects.
Determine the best expansion strategy
Once you understand your target market and have ascertained it is worth exploring, devise a strategy to engage it.
Having a local office in the country is optional before you can operate. Thanks to the internet, you can quickly get people to patronize your business from anywhere through your business website.
For orders that require shipping, you can partner with delivering companies in your main country of operation and, if possible, another in the foreign locations you are targeting for easy last-mile delivery.
In summary, you need a solid supply chain.
Create a budget
This might be the last on the list, but it is as important as any other tip. Create a budget for the expansion. Also, just like any venture, there should be a business plan and Key Performance Index (KPI) you would be using to gauge the investment over a predetermined period.
Meanwhile, keep your budget manageable. Only invest an amount you are confident would help achieve the goal for the market; nothing more.
Common business mistakes in global expansion
- Venturing when not ready
Some businesses try to expand when they are not ready for global expansion. Such a move can be catastrophic as it can result in a waste of money and may even cause the collapse of the home business.
You need to expand across your home market to its limit before considering exploring the international market.
- Payment methods
Every market has its preferred payment method. Some businesses go into a foreign market with plans for payment methods that are the same as their home market, which can be the single cause of the failure of such a firm’s international expansion.
- Exchange rate and conversion fee
Receiving payments abroad can be frustrating. You cannot expect to charge in your local currency for every market. This, however, may not apply to some SaaS B2B firms. For businesses that have no other option than to request payment in local currency, other problems they are likely to face are exchange and transfer fees. They may also be at the mercy of the regional government’s policy.
- Inflexible strategy
Even though brand identity is essential, it is at the same time necessary that you promote it in a way that resonates with the target market. Culture and the economy play critical roles in any market. Some businesses fail to realize this and instead remain rigid with the strategy they use at home.
- Underfunding
A company’s main market undoubtedly contributes most to a company’s revenue. This does not mean the international market should be ignored or underfunded, especially if it shows any potential.
A company’s plan for its international market should reflect in the amount of attention dedicated to it.
This is a guest contribution by Charles Dearing.
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