In this era of globalization, expanding one’s business in the global field has become an obvious decision for those who wish to progress and move forward. International expansion is a significant opportunity for many companies and entrepreneurs. It is a sign of success and growth, and it makes for a more prestigious reputation. While expanding globally has its many advantages, fulfilling this goal can be quite tricky and complicated, that is why it is essential to have an international expansion strategy.
Many fail in their global expansion because they start this process without much preparation or a concrete plan, thus decreasing their chances of success dramatically in the worldwide field. To avoid starting your expansion underprepared, creating an international expansion strategy is in order. The purpose of this article is to provide a list of the top services that are crucial for any global expansion plan.
Expanding Globally- What are the main benefits?
It is not in vain that plenty of companies choose to take this step and start the process of global expansion. Many recognize the potential that this expansion can bring, as well as its profitable results, which are:
- Better revenue potential- the increase of opportunities will create an increase in revenue.
- More extensive customer base– allows the investment and introduction of new products or services.
- Higher stability chances– it is risky to depend on the economic stability of one country alone rather than diversifying your options.
- Greater access to talents– finding new international talents is a great opportunity, one that can offer a more extensive range of creativity and diversity within your company.
- Improved reputation– Expanding abroad allows a company to build name brand recognition and establish credibility internationally.
Increase savings- Many companies prefer to move some of their manufacturing operations to countries with cheaper labor costs, thus saving a significant amount of money
Steps to Expand Globally:
While creating your international expansion strategy, it is essential to consider these four significant steps listed below to ensure the success of your operation:
First Step- Globalization Strategy
A proper strategy always has an end goal in mind. While establishing your international expansion strategy, you should consider what you want to get out of your business expansion. While gaining more customers and increasing profit are the obvious answers, it is best to focus on more specific goals. Setting your expectations would help you clearly define the purpose of your global expansion and help you and your company strive toward that particular objective. Answering questions such as What are your sales goals for the first year? / What kind of customer retention can you realistically expect? / How much time and money do you expect to spend on the expansion? / How long will it take to see a return on investment? – will create a set of goals in mind that you can stand behind.
Second Step- Market Entry Strategy
After establishing the purpose of your expansion strategy, the next step you should focus on is market research. Choosing the market that best suits your product and industry is a crucial decision that must be made carefully. Failing to select the correct country for your company’s expansion could lead to a waste of time and a tremendous financial loss because not every country is suited for every market. Thorough market research should conclude the country’s market conditions, opportunities, and challenges– all to gain a clear picture of the market’s demand and competition. The information for your market entry strategy can be obtained from conferences, trade shows, and even more specific sources such as governmental reports. These different sources would give you a better insight into which country will best align with your business expansion goal.
Third Step- Marketing Strategy
Planning your marketing strategy is an essential step toward a successful global expansion. After finding the market that best fits your product/service, launching into this particular market blindly will not be strategically wise. To get an understanding of how your products will fit in, you must do your research on the said market, one that would include:
- Cultural differences: It is impossible to expand your business to another country without understanding its culture first. Global expansion requires cultural preparation, and so your product must adapt to its unique custom. Only then can your target customers approve and appreciate your company’s service.
- Language barrier: The key to good marketing is, undoubtedly, communication. There is a basic need to market your product in the local language and be mindful of its every little nuance. Even when marketing in an English-speaking country, there are subtle changes between words in American-English, British-English, Australian-English, etc. It is strategically wise to hire an expert who could translate your service in a way that would be accessible for your target customers.
- Laws and regulations: Various markets are governed by policies that may regulate or prohibit the sale of certain goods. Also, there might be tax obligations you may need to pay when operating in a specific market. Make sure to look up and understand the laws and regulations of your chosen country to avoid any misunderstandings.
- Adjusted marketing plan: Not every marketing plan works in every country. There is a need to observe, learn and adjust your marketing strategy according to each country’s preference. For example, Facebook, WhatsApp, and Google are restricted by the Great Firewall of China, thus relying on these platforms as marketing tools in the Chinese market will be a mistake. Instead, learning about WeChat (one of the most popular apps in China) or MaiMai and adjusting your marketing plan accordingly will be the best way to reach your Chinese audience.
Fourth Step- Branding Strategy
While it is essential to localize your product, staying true to yourself and your brand is meaningful in itself. In the sea of consumption, there is a need to stand out from the rest. Establishing your brand in a foreign country that is both localized but still unique and authentic can be the way to best win against your competitors. McDonald’s is an excellent example of an established brand that succeeded way past the walls of America. While McDonald changed a few things in their menu to better cater to the preference of different countries, they still did not change their brand nor their fundamental characteristics. That way, they could reach a wide range of new customers while keeping true to their established brand.
Conclusion- How to make your plan into reality:
Following the four steps mentioned above is a sure way to succeed in the global field; however, it is nearly impossible to do it alone. To complete all of these steps in a trouble-free and professional way, hiring a team of experts is in order. A company with a handful of resources, experience in the field of global expansion, and a tailor-made approach to best fit your brand- is what you need by your side to fulfill your business expansion. Xinergy Global is all of that and more, the key for turning your international expansion plan into reality.