Part of the reason is due to the resources that are now available for any entrepreneur to use. For instance, doing the appropriate market research is a click of a button away due to the world-wide-web. You can easily look at case studies on how other companies have performed, what has and has not worked for them. Of course, before even beginning to think about expansion into a global market, you must focus on where you are presently located.
You will need a good online presence, such that you can be searchable from anywhere in the world, and you will furthermore need to consider the cost associated with entering the foreign market. For more information, continue reading.
1. Market research
Research is key before you put anything into action. If you are currently locatedin North America, selling your products in Europe or even somewhere in Asia will be completely different. You need to prep yourself, and thus understand the new culture and what the profitability of entering it would be. Moreover, doing enough research at the beginning will also help you determine which market you will benefit from entering the most. There is even a matterof communication, as entering another English-speaking market would naturally be easier to start.
While you may be able to understand that your customers are of similar age, gender, etc. as the customers you have back at home, you need to discuss the differences in culture. For instance, if you are a gaming company who usually sells games catered to boys, hitting the Japanese markets are going to be incredibly different. In Japan, males and females play games in similar numbers. They also have a fast-paced intense market which may be difficult to become noticed in.
2. Online presence
A company that has a strong online presence is going to achieve more than its competitors ever would. Thisis incredibly important not only for the global marketbut foryour home-base as well. Ask yourself:
Can consumers easily find your products online?
Is your company transparent in what they stand for?
Is your website showing on the first page of Google?
All of this adds credibility, and it is a necessity before you even think about going international. Thisis why there are many benefits ofa website, in addition to having a social media presence.
Everything ties back to cost, and that is why you need to understand what both the apparent and hidden costs of global expansion are.
What is the cost of manufacturing?
What about shipping a certain product?
Will you open up a physical store or simplykeep everything online?
You need to periodically overview your finances so that you are aware of the costs going out and the profits coming in. For expansion to be successful, your business needs to scale according to your budget and demand. If you expand too quickly, you will collapse, and worse yet, be unable to recover to your smaller, successful business.
What’s more, every single country has their own legal requirements, whether it’s tax laws or employment contracts that you need to consider. The customs will inevitably be different, and you need to understand exactlywhat all of those requirements are.