Expand your business internationally

Expand Your Business Internationally | Steps towards successful international expansion

Expand your business internationally

Expand Your Business Internationally | Steps towards successful international expansion

Steps to Expand Your Business Internationally

Is your business in good health and are you thinking to expand your business internationally? Prospecting, setting up, exporting, business formalities… In this article, we explore key considerations and essential strategies for businesses looking to unlock new opportunities in global markets.

Stop holding back your international development ambitions! Here are 6 steps to prepare

Ideally, internationalization should be planned and part of a strategic vision of the trajectory of the company. It is a question of setting objectives, carrying out market studies, evaluating different alternatives, developing selection criteria. So even if SMEs are tempted to seize all the sales opportunities that arise, international development should not depend only on the chance of a meeting at a trade show.

To succeed in exporting and develop internationally, take the time to prepare yourself well.
Take stock of your project, your resources and gather information from the potential market in order to establish a clear and effective strategy.
Do not hesitate to get closer to local partners and rely on reliable relays.

Unlocking International Expansion: Key Considerations for Global Market Entry Strategies

Embarking on international expansion requires a strategic approach that considers various factors crucial for success. Below are the essential steps to effectively navigate the complexities of international expansion and craft successful market entry strategies:

1 – Define a clear strategy

To plan a good strategy, you will need to have a good knowledge of:

The ecosystem:

– The target market and its access points
– Potential competitors
– The key players
– Events of interest

Your business:

– What market will I enter?
– What does my product/service bring to the market?
– What price positioning to adopt?
– What are the logistical, financial and human resources… to be brought together?
You will need to diagnose your strengths and weaknesses, this will help you detect opportunities and risks.

Have a clear and specific objective

The entrepreneur must be convinced of the richness that this new challenge will bring to his company. This is the first step before getting started. Making a one-off sale abroad or seizing an opportunity via a trade show does not always lead the company to develop a flow of business. However, it can be the right starting point to assess its potential and clarify its purpose.

Whether the company wishes to expand or diversify its customer base, gain market share, ensure the viability of its business, follow customers or partners, be closer to a source of raw material supply… Go international requires you to think of your business differently, and the project as a whole.

Make an action plan

After studying all the administrative and financial aspects, you will begin to create your action plan. For this, you must detail:

  • Objectives to be achieved
  • Associated KPIs
  • Various human and financial resources to be implemented
  • Operational actions
  • Deadlines, etc.

Read also: Action Plan: Steps to follow + examples and tips

It is in this stage that the roles of each collaborator must be assigned and where the project really begins to materialize.

It is also here that you will realize the importance of being accompanied by certain service providers such as investors, subcontractors, suppliers, etc.

2 – Adapt your offer to the market

Copying and pasting is the easy way out, but it’s not necessarily the best thing to do when you want to develop abroad.
A product/service that has worked well on French territory will not have the same success in a neighboring country, let alone on another continent.

Ask yourself the following questions:
  • What added value does my product bring to the market?
  • What are the benefits and performance gains for my client?
  • What adaptations will I have to make to my product (color, taste, packaging, etc.), and what marketing decisions to take (translated website, faster and more ergonomic)?

The big brands have understood this and are making readjustments. You will therefore have to pay particular attention to the local culture, to the uses and habits of consumers, because the foreigner… is you!

Make sure your business can do this

Once the objective has been defined, the second step is to ensure its human, financial and organizational capacity to develop in foreign markets. To respond to this, the company may need to increase its production, need a new supply chain, adapt its commercial and legal aspects, integrate new skills, strengthen its digital tools or consider alliances, etc. But the market must also be sufficient and the offer adaptable.

Many companies, for example, keep the idea that the Chinese market is not very innovative and “cheap” while it is getting closer and closer to European standards, with new business models. Discrepancies that require clearly identifying the outlets and also ensuring the regulations in force in order to avoid potential hidden obstacles, such as customs fees that are too high, so that the offer remains competitive.

Examine regulatory barriers

This step draws its foundations from an essential study of the market. The large local companies that have taken up the challenge of establishing themselves abroad have all been there. More complicated internationally than within the country, the study must gather a certain number of documents in order to better understand the market requirements in other countries and other continents. This will allow you to grasp the potential of your expansion and the building blocks of the target market. At the end of this analysis, you will discover what are called “regulatory barriers” which include commercial, physical but also ecological constraints at the level of transactions.

To be successful, you need to be in tune with local practices and create a palpable competitive gap that defines your brand. This approach would inevitably lead to an awareness of the complexity of the procedures, their length, the tax declarations and the hassle of the operations required for administrative management. You can consider that you are on the right track if you manage to adapt your offer to the requirements of the country or the continent through effective communication that emphasizes the services related to the product offered.

3 – Choose the right mode of representation

To start on a foreign market, it is in your interest to:

  • shorten and simplify sales channels,
  • be in direct contact with the customer,
  • and start with a light structure (liaison office, branch, commercial agent, etc.)

This will allow you to anticipate changes in ranges and the technical expectations of customers. You will thus be able to test the market before considering a heavier commercial establishment.

Adapt your internationalization project

Secondly, going international is accessible to any company as long as it adapts its project to its size and financial capacity. It can rely on existing levers and aid that will support its internationalization effort, such as prospecting insurance in the event of commercial failure, but also public schemes and regional subsidies that can give a real boost. to the gait.

Certain markets such as the U.S. are highly acclaimed with yet a very high entry ticket to carry out a solid project. Going to European or border markets to limit legal costs can be just as significant for a start-up company.

Adapt to the characteristics of the local market

When you want to develop your offer internationally, it is difficult, if not impossible, to model your current strategy.

Financial risk management in business: how to put it in place

4 – Optimize your financial resources

Going international is an investment and it cannot be improvised! You will have to spend – sometimes a lot – and check the your own cash flow before committing to this process.

Here are some aspects of your strategy that will incur costs:
  • a communication plan,
  • travel expenses,
  • prospecting costs (presence of exhibitions),
  • intellectual property issues,
  • the creation of ad hoc or subsidiary structures,
  • the use of legal advice,
  • the recruitment of local staff (perhaps an expatriation, a VIE…),
  • Etc.

These costs are assessed and provisioned as accurately as possible and generally amortized only after 3 to 4 years.

Control the share of risks

Going international means knowing how to take risks, but controlled risks. Last step for the company, it is essential to glean as much information as possible, by getting closer to its peers or partners, to know all the risks and especially to be able to anticipate them. Export smiles on those who have prepared for it: the company will guarantee the success of its project by its qualities of anticipation and preparation.

Choose your entry mode based on “acceptable losses”

Thinking about the mode of entry (via an agent, a local distributor, with a trader, via a commercial subsidiary, etc.) is crucial to obtain the most appropriate representation in the target country, and those that best correspond to the necessary financial commitments and the losses (“acceptable losses”) that the SME is ready to accept when entering a market before choosing a mode of entry. The resolution of this problem necessarily involves the development of contacts and networks, which are the most economical way for SMEs to create opportunities.

5 – Select your staff for this project

Have you identified people who are motivated and able to work in an international environment?

First, you will have to make an inventory of the languages ​​spoken in the company as well as the employees with an international sensitivity and who will constitute future relays for your project.

Then, you will need to identify people who have solid training in export techniques (incoterms, invoicing, transport, customs subjects, free trade agreements, etc.). If not, consider forming your teams.

Gradually, your entire company will have to synchronize with your export project.

You must adapt it to the cultural differences of the country concerned:

Your offer which must meet the expectations of local consumers. For this, it is necessary to acquire a detailed knowledge of the country and its customers. You can create new personas to describe the typical profile of your consumers.

Your communication strategy disseminated on the most relevant communication channels. Your strategy must obey certain particularities and respect the cultural codes of the country. For example, it is better to communicate via “Vkontakte” in Russia, which is a site similar to Facebook, much more popular among 18-34 year olds.

Your various content, translated into the official language. All your media must therefore be adapted to the country, such as your website, your packaging, publications on your social networks, and even your legal documents!

Create a trusted team

To develop internationally, it is important to create links and establish long-term professional relationships with talents and potential collaborators from the country where the manager decides to start. Without this, the start-up and development of the service or product of the company abroad is very likely to fail. Immersing yourself for a few days in the country concerned is then the opportunity to establish more agile relationships with future partners, collaborators or investors. Attending international trade shows can be useful for accelerating the international expansion of your business, in order to discover new talents and convince them to get involved in it.

It is important to draw up a list of specific criteria that these future members of the company must meet. The people selected must be quite solid and particularly expert in their field as well as know the target market inside out. Once the team is formed, it is important to manage it effectively. The leader will have to show trust, understanding and support while explaining what exactly he wants to put in place. He cannot be in two places at the same time, so he needs to delegate to trustworthy people, who will ensure the development of his company internationally. It is also important that the entrepreneur meets with them several times a year. The success or failure of this export project depends on the choice and trust in foreign partners.

Read also: Payroll and Human Resources Management

6 – Activate your networks

Have you chosen the country of choice?

Do not forget to look in your networks if you have interesting contacts who can help you in your development process? And if so, can they recommend useful contacts?

There are a multitude of clubs for networking, whether in the target country (embassy, ​​chambers of commerce, trade fairs, clubs and networks, etc.) or even in France. Find out, go to places where people meet.
Solo development is very complicated, but unity is strength!

7 – Understand cultural differences

Business is above all a human encounter between people of different languages ​​and cultures. Very often, it is the lack of understanding of the cultural aspect that causes your projects to capsize.

Knowledge of local codes, habits and customs and behaviors cannot be learned in school textbooks. Indeed, the color “red” for example does not have the same meaning from one country to another, and perhaps your trade name designates something particular, after translation.

You have several options for your business:
  • rely on people who know the local codes perfectly,
  • have an in-house bicultural person trained in the corporate culture, your products and knowing the local market perfectly,
  • send someone on site (or go there yourself) to soak up and understand market expectations.
Choose the right country and target the right customers

The selection will depend on the importance of demand and opportunities abroad, competition, obstacles (regulations, adaptations, customs duties, etc.) and the purchasing power of customers.
The information comes mainly from prospects themselves, meetings at trade shows, professional databases (eg Kompass), other companies offering complementary products and targeting the same clientele, the Internet, organizations export assistance or other institutions.

8 – Get accompanied

Remember to be accompanied in your export project, whether at the level of a request for financing or on the accompaniment in the development of your company (prospecting, organization, communication, etc.).

There are various support systems for exporters. Be close to export teams in the choosen country, for examples: Chambers of Commerce and teams abroad (private organizations abroad, etc.).

You won’t be able to do everything at the same time, so don’t spread yourself too thin and target your priorities. Transform your strategy into a real business plan!

  • Enterprise Europe Network: The Enterprise Europe Network (EEN) helps businesses innovate and grow on an international scale. It is the world’s largest support network for small and medium-sized enterprises (SMEs) with international ambitions. Services includes: chambers of commerce and industry, regional development organisations, universities and research institutes, innovation agencies.
  • China IPR SME Helpdesk:  is a project funded by the European Commission’s Directorate-General for Enterprise and Industry (DG ENTR). It provides European small and medium-sized enterprises with free, practical support on Intellectual Property Rights (IPR) in China. According to its website, The China IPR SME Helpdesk’s mission is to “support European Union (EU) small and medium sized enterprises (SMEs) to both protect and enforce their Intellectual Property Rights (IPR) in or relating to China, through the provision of free information and services”.
  • Organisation for Economic Co-operation and Development (OECD): The OECD is a multi-disciplinary inter-governmental organisation of 36 member countries which engages in its work an increasing number of non-members from all regions of the world. The Organisation’s core mission today is to help governments work together towards a stronger, cleaner, fairer global economy. Through its network of 250 specialised committees and working groups, the OECD provides a setting where governments compare policy experiences, seek answers to common problems, identify good practice, and coordinate domestic and international policies. More information available: www.oecd.org.
  • International Council for Small Business (ICSB): in Washington DC, USA. To promote the growth and development of small businesses worldwide. This organization brings together educators, researchers, policy-makers and practitioners from around the world to share knowledge and expertise in their respective fields through publications, programs, workshops, training sessions and certifications.
  • FoundersCard: More than 20,000 entrepreneurs, innovators and business professionals are part of FoundersCard, an organization that offers exclusive discounts on hotel, travel, business and lifestyle products and services, as well as access to invitation-only networking events. It’s perfect for getting that new office coffee machine or extra frequent flyer miles!
  • Entrepreneur’s Organization: Members of the Entrepreneur’s Organization also receive perks like personal mentorships, participating in forums where you can learn from the experiences of successful business owners. EO members may also become a part of the Healthnetwork Foundation to gain VIP access to the 30 of the most highly ranked hospitals in the U.S.
  • International Chamber of Commerce (ICC): ICC is the institutional representative of more than 45 million companies in over 100 countries (Africa, americas, Asia & Pacific, Europe and Midlle East). ICC is an organization that is responsible for providing protection to companies from the different countries of the world in terms of commercial operations, since today there is greater interdependence between nations, that is to say, what happens in one economy, affects the others. The CCI’s mission is to promote trade and investment between the world’s companies in the different sectors, as well as to help them face each of the challenges and opportunities that globalization offers. To achieve this mission, the CCI has a wide group of members, which are companies from more than 130 countries that carry out international operations, as well as business organizations, including the Chambers of Commerce of the different countries.
Strengthen its expertise

When the company develops internationally, it also integrates skills and expertise, by calling on specialized consultants or hiring export managers. It is thus changing its decision-making process on target markets and entry methods.

Sources: PinterPandai, CleverlySmart

Photo credit: geralt via Pixabay

Success in Your International Projects | Tips and Examples

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