It’s always gratifying to build a business from the ground up, expanding into both the local and regional markets and eventually building your company into a national powerhouse. The only place to go from there is up – and that’s why international business expansion might just be your most strategic next step.
Of course, expansion overseas can be fraught with cultural, regulatory, financial, and security issues. In order to navigate the process smoothly and successfully, here are five tips for successfully expanding your business internationally.
Don’t Underestimate the Costs Associated with International Business Expansion
Expanding internationally is going to cost you an arm and a leg. That’s great if you’ve got deep pockets already, but even then you’re likely to need outside funding. If you’re looking for how to find investors for international expansion or funding for startups that are going international, you’ll have to find potential funding sources that believe in your company’s vision. Much of this is going to depend on where you’re looking to set up your new international headquarters.
Many countries might have resources you can use to find interested investors. Entrepreneurs setting up international branches in other countries should contact a government entity like a consulate or an embassy for your target country and ask if there are any private or public sector initiatives to attract international business. You can also use this opportunity to research the specific taxation and regulatory laws of your target country.
Work Out Travel Arrangements Beforehand
Setting up your company in a country other than your own can’t be done instantaneously. You should expect to spend lots of time in a foreign country – or have staff spend lots of time there – and that means extended stays.
In these cases, you should make travel arrangements using your target country’s visa system. Some countries, like Australia, have expedited resources such as the Electronic Travel Authority system that provides more leeway than just a passport visit but that lets you avoid some of the hassles of obtaining a full work visa.
Build a Local Network
When you send yourself and your colleagues abroad for your business, you shouldn’t only focus on figuring out logistics; you should also make an effort to build a network of locals in the industry. Connecting with local business leaders and VCs won’t only provide you with funding opportunities, but it will also help point you toward important industry trends within the country. You’ll also be able to learn about cultural norms that can help you market your product according to local trends and preferences.
If you’re stuck about how to connect with VCs in the first place, co-working spaces provide a great opportunity to build a local network. Local co-working spaces are full of people in the industry who can be valuable resources as you expand your business internationally and who can even introduce you to industry leaders and funding opportunities.
Prepare to Navigate Cultural Differences
There’s nothing worse than spending countless amounts of time, effort, and money on working out or closing an international deal, only to have it stall or go south at the last possible second. In some cases, the culprit could be cultural missteps. Remember, there are differences between how business is conducted in your home country and how it’s done in your target country.
There are resources to understand and prepare for these cultural differences. Making use of scholarly research on the subject is always recommended, but you can also peruse travel books designed for pleasure trips. Many of these books will have comprehensive sections on how the culture of your target country differs from your own, helping you avoid some particularly nasty pitfalls.
Differentiate Yourself From the Local Brands
It doesn’t matter if you’re offering financial services, manufacturing electronics, or marketing various widgets – breaking into an overseas market means taking on the competition. You have to differentiate yourself from local outfits that provide the same products and services you do if you want to have a successful international business expansion strategy; after all, why go with the foreign upstart when local companies already satisfy customers and clients?
This all comes down to your marketing efforts. Hire an experienced global marketing manager, peruse the trade industry journals, and conduct extensive and effective research in these new international markets you’re venturing into. Ideally this should be done before you open the doors of your new headquarters, but it’s never too late to get started.