If growing your business is a goal, the best market to expand into may be overseas. Although before you leap, it’s vital you understand what such an expansion will involve. Happily, you can get the low down on precisely this topic, in our post below.
How can I choose which country to expand into?
There are a range of considerations to make here. The first and arguably the most important one is whether the location in question has a market for the product you are offering. After all, if there is no demand for your product, then no amount of marketing wizardry is going to help you become successful.
In addition to the market for your specific product, an assessment of the overall economy of the location you are considering is also necessary. In particular looking at employment rates, GDP, and CPI is helpful here as they will be able to tell you how healthy the economy is and so whether expanding into those geographical areas is a good idea.
What practical issues will I need to consider when expanding overseas?
In addition to the risks of expanding your business overseas, there are several practical issues to consider as well. The first of these are issues of translation which will apply to your product packaging, your marketing, and the communications within your business. For the first two instances using a professional translation service is a smart idea, as once they have been converted once, you can use the same text over and over again.
Of course, inter-business communication is a little more complicated. With that in mind, making sure you have at least one person that speaks both languages in all your locations is a good idea. Over the long term, you could also provide funding for people to learn the languages needed to ensure the smooth running of your company in the future.
Other practical considerations when expanding your business overseas include how you will get your products to the location you want to sell them in. This is particularly important if you manufacture your products in a country other than the ones you will sell them.
For this, you will need to answer some other important questions which include: what is a customs broker and whether you will use a freight forwarder for shipping? Indeed, these two things are essential to getting your shipping right.
They are such important considerations because a freight forwarder is a company that will handle getting your product onto the ships, across the sea, and unloaded again at the other side. However, freight forwarders can’t do their work unless a customs broker is involved. The reason for this is that it’s the customs broker that can submit a customs declaration, without which your products will not be able to pass into your country of choice. All of which means sorting this out is pretty vital to any successful expansion.
What are the benefits associated with overseas expansion?
Before making the major decision to expand your business overseas it’s vital that you consider both the associated risk and the potential benefits that you could gain. The good news is that the benefits are many, the first of which includes getting access to a wider market for your product.
Another benefit may include being able to save money on production and logistics costs because of (depending on the location) cheaper labor, utilities, and rent.
Then there is the opportunity to stay ahead of your closest competition. After all, if you expand into a market sooner than they do, it’s much more likely that you will retain a larger market share over the long term.
Additionally, when expanding overseas you will also have the benefit of being able to access local talent. This can be great news for both your operations and your research and development teams, as new ideas can help shake up and enthuse the whole process.
What risks are associated with overseas expansion?
Of course, nothing is all roses, and that means there are plenty of risks and threats to consider when expanding internationally as well. One of the most significant of these is that your product won’t work as well in a different market. Although there are ways of guarding against this such as making sure you translate packaging into local languages and use local influencers to promote it.
Another risk that it is necessary to consider carefully is the political situation in any location you are thinking of expanding into. This is because while linked, the economic and political situation of any country are separate things. What this means is you may not get all the information you need from only looking at how well a location is performing economically, so you must make sure to do a political assessment as well.