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Going Global: How to Expand Business Internationally

Apr 22, 2020 - by eFax Team

Are you eager to set up an international business plan? It's not for the fainthearted. Before you go any further, consider this sage advice from experts who have been there before.

It is not uncommon to see small business enterprises from the UK trading with customers in countries like the United States, Canada, India, China and many nations across Europe. Businesses reaching out to global markets is nothing new, but may not be something your business has yet taken advantage of.

There are plenty of reasons for going global, including access to a new market, a chance to scale up business activities, protecting rights to intellectual property overseas, and developing new business contact relationships and networks.

However, once we've concerned ourselves with the why of global expansion, we have to think about the how.


Expanding internationally is not a straightforward task for any business. There are lots of influential factors to consider that affect how you start a business in a new region of the world. Almost any budding international business can overcome the hurdles of globalisation and enjoy the advantages and opportunities that selling in another country represents — but only if the process is handled with proper understanding.

Your expansion journey can be as successful as your major competitors, or it can be a disastrous failure; the difference is often about the information you absorb, avoiding assumptions and carefully considering strategy.

This article is just one of many resources we recommend you absorb before selling your products and services internationally. Always take on as much information as you can before you make this incredible but potentially risky business expansion decision — be it through business contacts, handbooks, books, webinars, and so on.


Identify Your International Customer Base

Every market has something different to offer businesses — from unique opportunities to cultural differences that create very specific demands. For example, you'll find that in Japan, huge opportunities exist for manufacturing enterprises, while in Australia most of the countries GDP is built around the service sector and tourism.

It's important to be aware of these differences, as well as market saturation and availability of trade.

The US is known to have the largest economy in the world, with China following behind. Just because these two powerhouse economies are wealthy, however, doesn't mean they are the best fit for your company. If their markets aren't buying what you are selling — or there are too many competing businesses — it doesn't matter how much money there is, you are unlikely to see a piece of it. Unless that is, you have a very aggressive marketing strategy and a budget to match.

Instead, a smaller international market could be exactly what you are looking for. Prospects may be far superior in regions with less cash, simply because you are offering something that appeals to the market and there is room for it. The best way to secure your optimum destination for international business expansion is through extensive market research.


Determine the Cost-Effectiveness of International Expansion

There is always new money in international markets, that much is without doubt. However, what you must consider is the ROI. Cost analysis is crucial at this stage. Look at what it will cost you to open up business overseas and what kind of growth you can expect from it. You can then compare this to similar investments in domestic products, and determine whether or not the rewards are worth the investment and risk.

Why do businesses operate internationally when their domestic markets are so large? Often, it’s because the ROI of moving to a more diverse range of income sources is worth the cost of entry. But this is not always the case. Before proceeding, you need to know if you can compete with other businesses, and achieve success, or if the amount of resources involved in international expansion is going to hinder your business prospects.


Test Products and Services in Your International Markets

You've identified your target market, and you've legitimised this opportunity as financially viable. But, that still doesn't mean you're ready to face international expansion. As with any good market research strategy and overall business plan, you should always consider product testing.

You need proof of concept before you invest in full-scale international operations. When looking at expansion, company policy should always make sure sales are actually viable. The market may exist on paper, but do people really want what you are offering?

Use whatever resources you have at your disposal to market test. Market testing can range from the introduction of products and services to a select group of individuals to speaking to network contracts or arranging meetings with potential investors to get their feedback.


Get Culturally Aware of Foreign Markets

When you expand into new regions, you will face new cultures. Cultural differences may be the driving factor behind your international expansion in the first place, but they do present their own obstacles. Business owners should be aware of how different cultural norms will impact business interaction. When trying to generate leads, you mustn’t attempt to force your own ideas on your market, but instead, adapt to the way they work.

For example, in China, B2B relationships are built around very particular practices of etiquette and loyalty. Professionalism is highly valued, as are traditional formalities. Punctuality and preparedness are essential, and a lack of either is seen as disrespectful. To build networks in China, you need to be ready to put a lot of effort into developing complex and long-term business relationships. China is not — generally speaking — a culture of quick meetings and one-off deals!

Of course, you may not be considering China, but this example serves a purpose wherever you decide to expand internationally. To be successful and find business opportunities, you need to do as the locals do. For this reason, it's essential to build awareness and understanding of foreign markets and a sales team that can deliver the results you require.


Acquire the Necessary Technology for International Business

Just as different business landscapes have different cultures, so to do they have different software solutions and technology to manage their companies. Your business needs to incorporate this technology to achieve vital connectivity and communication. If your technology is incompatible with other international businesses, then you'll find barriers to trade. These barriers, however, are avoidable. All you have to do is learn what technology is used by your new clients, consumers and suppliers, and ensure you are using this technology too.

In Japan, for example, fax remains crucial for trade. Over half of households still have a fax machine, and almost all businesses use them. If you don't have a fax machine and you want to conduct business in Japan, you'll struggle. This doesn't mean you have to buy outdated hardware, though. eFax online fax solutions let you send and receive fax from your computer and smartphone, revolutionising fax while remaining connected.

As with our example, you don't need to accept poor technological solutions if there are better and more viable options (like online fax) that allow you to do the same job. Meeting technological demands is not simply about doing exactly what your new market does, but instead securing free-flowing working relationships.


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Understand the Legal Processes Involved in Expanding Your Business Overseas

When you go into business domestically, you have to follow a number of rules and regulations. From registering your company name with HMRC to paying VAT taxes, there are lots of legal elements and government agencies that business leaders need to be aware of before they can set up a company.

International business is no different. Just because you are established domestically, you do not have the right to establish yourself wherever you like. If you decide you want to trade overseas, you'll need to go through the relevant legal processes required by the local government. Requirements vary from country to country, which is why we suggest you seek legal advice from an expert in your chosen target market.


Establish Your International Business Profile

You're going to be doing business in a new country, which means you can't rely on your domestic marketing plan to reach your new customer base. Your business — whether you are service providers or product retailers — must develop a sales methodology that allows you to engage with target markets.

What does this mean? It means not only building a unique market strategy based on your new market's culture but also forming a core for your new market to operate around. This core includes the development of an internationally available website and social media profiles. UK-based platforms are not going to be appealing, and potentially not even visible, to international markets.

You may also need to rebrand your business overseas if your current brand name is already taken or does not suit the market culture. Many famous business organisations have rebranded for overseas customers, such as Walkers Crisps, marketed as Lays in the US.


Develop a Local Team for International Expansion

This team is sometimes known as a “beachhead team”. The idea is to support your business's expansion into an international market; you create a team temporarily dedicated to overseeing project development while a fully-realised international team is established. The beachhead team is often built from existing staff.

This team can be based locally with your new market, or they can be remote and work out of HQ. However, they'll do things like manage customer relations, recruit overseas team members, work within the appropriate time zones, and be the essential hub of communication and control for your new international company elements.

Separating a team when you expand your business internationally is very important. It allows you to quickly develop and grow your international operations without having to maintain a balance between overseas and domestic business management. It is suggested that members of your current senior management team head up this project, as they'll have the power and authority to drive change and take advantage of expansion opportunities without being as heavily restricted as other members of staff lower down the business hierarchy.

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