How a Business with a Local Focus Can Retool and Grow Internationally
Taking your company global is a worldwide movement that takes your business toward financial, economic, communications, and trade integration. For merging and small businesses, going global is an important step that can easily disrupt the activities of the existing business. It is therefore crucial for COO’s and business leaders to understand the full impact of the growth and look at whether the rewards of expanding outweigh the risks.
During the expansion phase, the stakeholders in the company will be tasked to take on more responsibilities in addition to their daily activities. It is not a simple process to take a business onto the global landscape. You have to understand the target markets, local market trends, and the competition deeply. You will also need to lay a strong foundation on how to launch and drive growth successfully.
Questions to ask yourself before you start
Growing a business in the local scene is not easy, and branching out to a foreign land is even tougher. Denis Mackenzie, COO of his winery relates well with the points listed below that can help you to make or break your business when going global. Here are some of the key questions you need to ask yourself:
Is your product or service familiar with your target market? If not, spend time and money to educate your consumers about it. But if you are the first to introduce a concept that is new and exciting, the product will represent your company.
Will the targeted culture purchase the product or service? You need to spend the time to research your market. The good part about American products is that they are absorbed overseas. Now, if you are going to introduce your wine selection in another country, you have to ensure that you create wine tasting events at venues that will attract people. Just as Denis Mackenzie does, you can also invest in developing the community with some of the wine tasting events you hold in a region. You can do this by offering some profits of the wine tasting event to a course that you see needs to be addressed in the community.
Are you comfortable in that country? When you branch out into another country, chances are that you are going to live there for a while during the early stages; you will also need to take time to network and know the culture and language of the country, to fit your product into the current lifestyle of the citizens.
How is the infrastructure in that country? How good are the roads? Have you guaranteed your supplies? What about other amenities like water availability?
Going global
Setting up your business overseas can seem like an uphill battle, but you can break down the process into steps. Let us look at six steps that will help you to take your business global:
To start you off, you need to prepare an international business plan that will start your campaign and help you evaluate the needs and goals of your business. It is vital to assess your commitment and readiness of going global before you branch out.
Conduct market research on the foreign market and identify key international markets you want to delve into. The best source of information is the U.S Department of Commerce which will help you get details on foreign markets for goods and services from the U.S.
Evaluate the methods that you will use for product distribution. You can start by opening a subsidiary of your company to work with distributors, representative, and agents, and set up joint ventures with them.
Learn how to negotiate deals, set prices, and navigate the legal side of exporting. Legal, social, cultural, and economic differences make it a challenge to export if you have only been working in the U.S.
You can look at ways in which the government and private institutions can help you to finance the exports because the government has an interest in exporting products to other countries.
Ensure that you move the goods you are producing to the international markets that the government is working with. Ensure that you package and label them in the way the target market regulations are set up. Although transportation systems for globalization can be the same, the difference will rest in different countries you are exporting.
Understand the culture of your targeted markets
One of the major difference between doing business locally and internationally is culture. You cannot assume that the way you do business in America is the same way you will do business in other countries. Go through the following tips to avoid mistakes that are prone to happen in international business meetings:
Avoid imposing time limits: have an open meeting because it will add strength to the position of negotiations.
Look to build relationships before doing business: make small talk and get to know the other parties before you discuss business.
Research: learn basic facts and pointers about the country; this will show the respect you have towards the potential partners. You can also get comfortable to use the basic words in their country.
Have an interpreter: bring an interpreter who will have your interests at heart.
Why should you go global?
Expanding your business to the global markets may not be the best option in some cases. The U.S market is enough to allow you to expand your small business, a point that Denis Mackenzie agrees with. On the other hand, when you enter the international space, you can protect yourself from domestic market decline, and this will significantly improve your company’s growth potential.
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