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It’s a big world out there. There are all kinds of different markets your business could be taking advantage of. If you’ve got a successful recipe for doing business in your home market, then it could be time for you to take the next step and expand your business globally.
Expanding globally isn’t as easy as just setting up and starting to make sales, though. There are lots of legal complexities and cultural differences you will need to overcome when you’re expanding to global markets. In fact, there are many big companies that have failed to make this step successfully.
International expansion needs to come about as the result of careful planning. There are many variables involved in this business decision. Moreover, you don’t want to be left hoping things will turn out all right. You want a plan to make sure it turns out right, and these five key points will play a big part in that plan.
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1. No Two Markets Are the Same
Just because something works well in your home market doesn’t guarantee it’s going to work well in another market. Each market is subject to different variables, and sometimes you will find that two markets in the same geographical area can have very little in common.
To overcome this, you need to undertake thorough research on each new market you’re going to enter. It would be nice if the same things worked in every country, but that’s what makes global expansion challenging. What’s more, it’s also a reason it can be so lucrative.
2. You Need to Understand Local Culture If You’re Going to Expand Globally
Advertising is full of great examples of why local culture is important to your business’s global expansion.
Even some of the biggest names in business have had problems with it. For example, KFC’s “finger-licking good” sounds fine in English. However, that translates into Chinese as, “We’ll eat your fingers off,” which didn’t turn out so well.
These mistakes aren’t just limited to dodgy translations in your advertising. They can also have serious consequences throughout your business on a global level.
To counteract this, it’s important you have people in your business who are familiar with various cultures and who can help you fit in with the local culture.
3. Legal Requirements Can Be Tricky in Global Markets
You know how many hoops you have to jump through to meet the legal requirements in your home country? Well in some other countries, you can double the number of hoops.
Whether it’s payroll in China, GST in India, or emissions standards in South Africa, there’s always something different you have to adapt to when it comes to global markets.
What’s more, how well you comply with the different requirements can make or break your ability to expand internationally.
That’s why it’s important to work with a partner like INS Global when expanding your business globally. Present in more than 15 countries worldwide, they have the legal expertise to get your business up and running, quickly and compliantly.
There are many working parts that make up a business, and when you expand into global markets, those parts can become a bit more complicated.
4. The Political Landscape in Any International Market Could Change
Just as no two markets are the same, neither are two countries’ political landscapes the same. If your home market is in a country with a stable political landscape, it can be easy to underestimate the effect politics can have on doing business in a country.
In order to assess the risks of expanding globally, you have to look at the country’s past political situation and how it might play out in the future. It’s no good expanding into a new country only for that country to expel all foreign-owned businesses the following year.
Therefore, whatever markets you expand into, it’s wise to have back-up plans and be well-prepared should issues arise.
5. Your Brand Is on the Line When You Expand to Global Markets
When you set up your brand in another country, your brand’s reputation is on the line in your home market, too.
The world has become an exceedingly interconnected place. If your global expansion bombs in a number of markets around the world, it can seriously affect your brand’s reputation in your home market.
You’ve worked hard to build your brand in your home market. Therefore, it’s important you don’t get too cavalier and throw that hard work away with a rushed international expansion. You may have conquered your home market, but it’s going to take careful planning to make sure that success is transplanted into foreign markets.
There are endless possibilities out there for businesses in global markets, but not all streets are paved with gold. You’ve worked hard to build your business in your home market and international expansion shouldn’t be seen as a shortcut to the next level.
You’ve got to build your international expansion with the same care and planning that you built your business in your local market.