5 Things to Know Before Taking Your Company Global
Taking a company global is exciting, and there’s nothing more rewarding than seeing your company expand far beyond its previous scope. However, crossing national borders is a difficult task, and it’s one that demands careful preparation. Here are five things to know before taking your company global.
When running a business in one country, it can be easy to take certain issues for granted. Culture affects how potential clients or customers interact with businesses, and these factors must be considered when taking your company global. Make sure to consult with experts in the markets you’re looking to enter, as techniques that drove your company’s success might fail in other areas due to cultural differences. The fundamentals of running your business will remain the same: Offering a valuable product or service at a compelling price translate well across all cultures. Learning how individuals you’re targeting in a new region will respond to your efforts, however, may lead to some surprises.
Different Types of Outreach
Before going global, determine how much people in your target market know about the type of product or service you’re selling. Your target audience might be wholly unfamiliar with what you’re selling, and outreach efforts that fail to provide adequate education might fall flat. Similarly, individuals in your target market might be savvier than those in the country in which your company is currently operating, and the results can be counterintuitive. People living in more impoverished regions, for example, often use their mobile payments more frequently than their counterparts in wealthier nations, so your current advertising techniques might not have the impact you anticipated. Advertising dedicated to education might be more suitable for certain areas, while brand-reinforcing advertising might be better suited to others.
Complexity is a Cost
Reaching into new markets requires dealing with new regulations, and it often demands hiring workers in a manner consistent with local laws. While these factors can be accounted for, companies often fail to consider the cost of complexity itself. When creating your budget, factor in the cost of dealing with this increased complexity, and make sure you’re able to handle unforeseen expenses that will inevitably arise along the way. No matter how prepared your company is for entering a new region, there will almost certainly be unexpected events that occur along the way. Err on the side of taking a conservative approach, especially if raising more capital will prove to be difficult.
When moving into a less wealthy region, it’s tempting to assume that all costs associated with doing business will be lower due to the lower cost of labor. In reality, however, infrastructure can have a dramatic effect on the cost of doing business. Countries with poor roads, for example, can present much higher than anticipated transportation costs, making it more expensive to succeed in certain fields. Similarly, regions where the internet infrastructure is less developed may make certain IT-based solutions impossible to implement, potentially raising costs. Make sure you have a good overview of the infrastructure your company will rely on before entering a new region and account for these costs as best as you can.
Take a Holistic View
Logistics deals with moving products and delivering services, but it also accounts for handling difficult regulatory environments and ensuring your company can operate in a profitable manner. It’s never too early to begin researching how your company will handle logistical issues when moving to a new country, and it is one question that’s worth hiring an expert for. What payments need to be made when shipping products or components used to make your products across borders? Will you need to hire translators, and what cost will that come with? Where are products taxed, and are your current methods of handling taxes appropriate for the new environment? Breaking down your entry into a new market involves calculating various expenses and estimating as accurately as possible, but it also involves changing your mindset to thrive in certain areas. Focus on the details, but step back on occasion to gauge the big picture and determine if your current strategies are realistic.
Growth is the goal of nearly all businesses, and reaching across national boundaries opens up tremendous possibilities for the future success of your company. However, moving to a new country is far more complex than moving to a new town or region within your own nation, and it’s common to underestimate the overall cost involved. Take your time, and make sure to plan as well as possible so that any surprises you encounter can be handled in a graceful, and financially sound, manner.
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