Some of the reasons to consider offering your product in other markets:
Of course with every opportunity there is risk and growing your business overseas is no different. The challenges your business will face when entering a new market can be broken into 4 broad themes:
Political: if you are hoping to expand into an emerging or nationalist market there may be political limitations that you don’t face elsewhere.
Economic: there are economic considerations when it comes to accessing new markets, they may take the form of additional taxes, cost of production or distribution.
Legal: before expanding it is important to seek legal advice on any regulations that may impact your industry or product in your target market.
Technical: these limitations can be interpreted in a number of ways they may be external or internal, both of which need to be considered before moving into a new market.
When it comes to taking the plunge into an overseas market, preparation is essential. Once you have done due diligence around potential constraints and worked out a potential market for your product, it is time to enter the research phase of expansion:
Research finance options
Exporting your products or services abroad is likely to be a costly exercise. If you can’t cover your projected costs funding options to consider include:
Conduct thorough market research
Conduct as much market research prior to entering a new market as you can. Use secondary research to understand if a similar product or service exists in your desired target market.
If you can afford to, conduct primary market research within your target marketing via surveys, focus groups and similar methods. Include all the insights you garner in your international business plan.
Develop an international business plan
Key to success is having a written plan for expansion. It should contain many of the elements of a standard business plan but with a focus on the markets you want to expand into:
Understand and respect the local culture
If you are expanding into a market that is significantly different to your own, research the local culture thoroughly:
All these elements are informed by the culture of a country or market. Being informed and respectful of culture will prevent any faux pas that could damage your brand or reputation.
Build your team expertise
Last but by no means least build the knowledge of the new market within your team. There are many ways in which businesses do this and the right option for your SME will very much depend on the product or service you provide. One way to do this is by setting up an office or base in the new market. Although the ultimate goal may be to hire local employees it is often useful to send employees from head office on expat assignment to establish an office initially.