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You’ve set up a business and grown your venture successfully – congratulations! But you’ve decided that domestic growth isn’t enough and now you’re considering expanding further. Trading internationally could offer huge benefits to your company, with the potential to open up new markets, create new jobs, and increase your client or customer base, thus (hopefully), driving up profits. However, while a potentially fantastic opportunity, doing business overseas also presents its own risks.
Therefore, if you’re considering expanding your business overseas, read these tips before taking the plunge and trading internationally.
Supply and Demand
Expanding internationally is expensive, so before you pack your bags and move you and your company overseas office, what you must do is assess the viability of your service or product. Is there a demand for your goods on an international scale? Are there similar products available? Are they of high quality? At what price do they retail? By doing your research, you can assess if global expansion is right for your company and make a calculated risk.
New Business Plan
One of the reasons businesses fail to achieve their potential when expanding internationally is because they make the mistake of not revisiting their business plan. Remember, just because your business has flourished in your home country, doesn’t mean you can replicate your plan overseas with the same success. Instead, speak to business contacts who have successfully gone global and research overseas markets. Then be prepared to adjust your business plan accordingly. Before you rush in to opening up an office in your chosen country, remember, there are other options available to you while you test the waters – looking into a temporary solution such as serviced meeting rooms will allow you to do just that, without making any major decisions on a whim.
Culture and Language
When your business grew from a solo entrepreneurial venture to a small team, or moved from trading locally to nationally, you probably considered things like marketing and shipping. However, when trading internationally, business owners must also take culture and language differences into account. Ask yourself: Do you know the language or will you require a translator? Will you hire local employees? Do you know customs and cultures?
Customs and Regulations
Although Brexit looms, for now, British businesses still have free access to the single market – but it’s worth mentioning that you may need to brace for change! However, if you’re planning to expand beyond the geographical boundaries of the EU, customs and border regulations start to become a little more complex. You’ll also find yourself in a new world of trade tariffs. So, make sure to investigate each new overseas territory, to ensure that your company complies with customs law.
Quality and Assurance
Your products may have been manufactured to meet UK and EU standards, but when you’re exporting goods abroad, you need to make sure that anything your business produces also complies with the Q&A rules of each country. This means implementing standardized testing to ensure your business is able to consistently produce high quality products, whether they’re manufactured at home or overseas.
Funds and Investments
Trading internationally requires time, dedication and a lot of effort, but like growing your business domestically, the process is also reliant on capital. While success overseas relies on a number of factors, your business must have enough funds to support expansion. If you want to take your company international but lack the cash, you could search for investors to provide the capital you need.
Plan Your Exit
This might seem a bit counterintuitive, but you should have an exit strategy. You can do loads of research on product demand, learn all about local customs, hire the right staff and become familiar with trading tariffs, but every new business venture comes with an element of risk. As such, before you begin, plan an exit, including a new domestic strategy. This means that should the worst happen, your pre-prepared exit plan will help to minimize business losses and make your departure a little easier.
