Getting your products into new hands is always exciting, and it can be doubly exciting when those new customers live elsewhere in the world. But expanding your operations into lucrative overseas markets isn’t as simple as boarding a plane. It takes thought, research, strategic partnerships and agility to pull off a successful international expansion.
Do not be deterred by the horror stories. Yes, you can find countless examples of (perhaps naïve, perhaps unlucky) businesses whose international expansion backfired. They followed the old model of road testing their company locally before carefully expanding, country by country, but their efforts imploded upon arrival. What gives?
Those companies – who now have the misfortune of modelling what not to do – probably fell prey to some common pitfalls. In this article, let’s explore three of the largest issues in the hopes of steering new jet-setting entrepreneurs on the right path.
Expanding Without a Plan
Too often, globally expanding businesses enter new markets with little more than confidence and local success to back them up. Let’s call it “corporate bravado.” Unfortunately, expanding internationally requires a great deal of forethought and planning. Everything requires planning, including:
- opening foreign business bank accounts
- adhering to foreign regulations
- hiring new staff
- incorporating new analytics and insights
- creating a locally appropriate pricing structure
- product internationalization
And the list goes on. As Benjamin Franklin once famously said, “By failing to prepare, you are preparing to fail.”
Going It Alone
An unfortunately common pitfall on the road to global expansion is dogged independence. Some entrepreneurs want to believe that it was their maverick streak responsible for initial success, but they forget the financial backers, collaborators and technological advances that aided them along the way.
In fact, the easiest way to successfully, effortlessly and safely capitalize on business expansion opportunities is to partner with a global proximity network like REEF. Recently in the news for their partnerships with large and small companies, REEF helps big thinkers enter new markets by leveraging a vast +5,000-strong network of parking lots and other urban spaces. Additionally, they assist with every point on this list, including staffing and day-to-day management.
If there’s one thing you take away from this article, it should be the value of a strong strategic partnership.
Neglecting Local Talent
Who knows a location better than the locals? Yet, all too often, globally expanding businesses overlook in-market talent in favour of familiar, homegrown alternatives. It is a subtle way of catering to the expanding company, not the new market.
With the help of your partner (see above), recruit local, in-market talent to staff your new location. This process will undoubtedly ease you into the new market, making expansion more seamless. Make it a point to listen to and learn from your new recruits as well – they often have invaluable insights into the local market.
Global expansion may sound scary, but past pitfalls shouldn’t deter you from trying. Learn from those who came before by doubling down on planning, collaborating with a global partner and utilizing local talent.