Expanding globally is almost a natural process for companies who wish to take their business to the next level. The ‘global expansion goal’ was once only deemed to be achievable for large companies. However, the international market is now open for small businesses, as well. It is now truly an attainable, accessible process. Many companies, big and small, are jumping for the opportunity to expand their business around the globe.
While it is true that achieving this expansion goal may be obtainable for many companies, it is still not the easiest of tasks. Many fail to achieve this goal because they were not prepared enough for the potential complications ahead. Although it may take some time and effort, internalization benefits are worthwhile in the short and long term. This article aims to highlight the benefits of global expansion and explain why companies wish to make their company international, despite the potential hurdles of said process.
Reason No. 1: Increase in Revenue
An increase in revenue is one of the main benefits of globalization. Marketing your product overseas exceeds the number of potential clients, thus providing a better increase in revenue. Global expansion equals business growth, which is not limited to the average income your home market can offer for your company.
Reason No. 2: Increase in Savings
While expanding globally offers better opportunities for gaining profit, it also allows for cheaper costs. Usually, it is cheaper to do business abroad because you can reduce production costs in more affordable countries. Likewise, the wage that you must pay for your international employees may be less than the salary you pay for your local employees, considering the distinction in minimum wage around the world. For example, one of the reasons that Apple outsources its manufacturing in China is to increase labor savings.
Reason No. 3: A More Extensive Customer Base- More Opportunities for Growth
Growth and reinvention are the keywords associated with international expansion. For the most part, a product or a convenient service in one market will not necessarily suit another. To cater to the needs of your new customer base there must be some adjustments made. These meaningful adjustments will most likely increase the chances of growth and development of your current product, thus allowing the investment and introduction of improved products or services. For example, Mcdonald’s had adjusted their meal options to cater to the needs of their customers all around the world, thus upgrading their original menu.
Reason No. 4: The Importance of Stability
A stable economy is not guaranteed; that is a fact that has become unfortunately apparent since the start of the COVID-19 pandemic. Although it is an extreme case, nothing is inevitable, and nothing should be taken for granted, especially in the business world. Hence why it is so important to not depend on the economic stability of one country alone, but rather raise your chances of economic survival by diversifying your markets.
Reason No. 5: Access to More Talents
Gaining access to a broader, more diverse pool of talents can only improve a company for the better. Different talents from different parts of the world can hold on to new sets of valuable skills that your current, local talents may lack. Access to new talents offer diversity, a cultural outlook, and language variety. Following that, it is safe to say that international talent comes with a unique point of view and improves innovation within a company, raising its prestige. Netflix is an excellent example of the usage of new talents in strengthening its brand. Netflix successfully created series and films in many different languages and cultural backgrounds, reaching a larger audience of viewers as a result.
Reason No. 6: Reputation and Prestige
It is a well-known fact that a good reputation is critical for any business, for it approves your company’s reliability and makes for an attractive brand. International expansion is the stamp of approval that shows that your company and product are successful, credible, and of high quality – all thanks to the added prestige that comes from going global. Since this process of international expansion is not an easy one to achieve, once you succeed in building a multinational cooperation, you gain recognition for your worldwide brand.
Reason No. 7: Gain a Competitive Edge
In this fast age of innovation, companies must use any advantage they have to stay relevant in the face of today’s competitive market. Globalization is just the competitive edge that your company needs for it to get ahead of your competitors in entering a new marketing field. Besides the fact that globalization gives your company the reputation and prestige that others may lack, globalization also grants access to new technologies and industry ecosystems that you can use to your advantage.
Reason No. 8: It is Easier Now Than Ever Before
While expanding internationally is not a hassle-free process, it is now a more straightforward thing to achieve than in the past. Globalization is so popular now because it has become a more convenient and much more achievable goal. With today’s technology and fast internet connection, it is now feasible to trade worldwide without being physically present in the country you wish to expand to. Many companies are now hiring teams they will never meet in person, and it is perfectly reasonable in today’s working culture. Other than that, Westernization has become more permanent in the last few decades, allowing for a more straightforward trade among different countries that wish to stay in touch with the trends of the West. Therefore, it is safe to say that Western companies are more appealing to a broader set of audiences than in the past.
Conclusion- Is it All Worth it?
The answer is yes. It is not by chance that the most successful and influential companies are the ones that gained international recognition. Today’s world is smaller than it was in the past, and even that is a good enough reason to decide to expand globally. Now that you grasp the benefits of globalization and wish to begin the process of expanding, it is essential to note that a strategic expansion plan is in order. To avoid being underprepared, there is a valid need to have a thorough, step-by-step plan for your global expansion.
For you to truly gain the most from this process and achieve all the possible benefits that globalization offers, it is highly recommended to seek the professional help of an expert. Xinergy Global is proven to be an expert in global expansion, the only service that you need for your company to become an international brand. Contact us today for a free 30-minute consultation.