Have you ever considered taking your business global? Because why settle for selling your services in just one country, when emerging markets across the world have almost unlimited profit potential?
According to CNN, Chinese consumers will have an incredible $6.4 trillion worth of buying power by the year 2025.
The possibility of 'making it' by providing services to foreign markets is certainly there. However, if you aren’t careful, you could flop.
If you've made the decision to go global, you'll need to thoroughly prepare your company for international business to maximise your chances of success.
Here are my top tips for preparing your business for international expansion.
Analyze foreign markets
Before you plot a path towards expanding globally, you'll first need to determine where exactly you'll have the best chance of success. Consider your service offering as well as corresponding marketing strategies, as not all services can thrive in particular markets.
For example, countries in more temperate climates don't need air-conditioning, but they do need heating. Adjusting per region will lead to higher revenues in the new market, and less time wasted on services that won’t sell.
Overall, you'll need to do an in-depth scientific analysis to determine your prospects in the different markets you're considering. This includes performing a market segmentation analysis to help you decide whether or not your services will sell in a given foreign market.
You'll also have to consider the competition that already exists; a gap analysis can help show whether or not the demand for your service offering is already being met by local competitors.
Consider the government
While research may suggest that a service could be profitable in a given country’s market, that alone doesn't mean you’d be successful there. You may come across unexpected roadblocks in the form of local government legislation and different ways of operating.
For example, not every country has free trade policies. Certain countries are protective of their home markets, and importing may come with high tariffs that makes doing business there unprofitable.
Conforming to the regulatory framework in a country can also prove challenging. The rules for how to successfully conform to the law in the United States are not the same in Europe, Asia and Africa, for example.
You may need to hire local business lawyers to insure you don’t fall afoul of the law.
Overall, providing new services in foreign countries requires diplomacy with the heads of the government and local politicians. Try to get someone on your team who knows the language and the culture; this can help smooth the process of entering a foreign market.
Consider where to purchase supplies
Expanding your services to foreign markets may make finding supplies and materials a challenge at first. You’ll need to consider purchasing materials from local suppliers, which may be difficult in the early stages.
While there may be some restrictions, shipping supplies from home might even be easier when getting started. However, order fulfilment requires a higher cost for shipping and handling, and this added expense will increase the purchase price for those consumers.
Selling to foreign markets also requires quality internet marketing. If your marketing isn’t geared towards the foreign demographics, you'll probably fail to reach those potential customers.
You'll have to do substantial research to determine what websites, platforms and content are best for reaching local consumers online.
You should also perform thorough analysis of advertisement and website traffic to determine just how many hits and conversions you're receiving from the countries in question.
If you aren’t producing good results, you'll probably need to tinker with your ads and ad placement until you do attract traffic from the right markets.
Overall, expanding your company to an international customer base isn’t easy. It takes a lot of planning, strategy and resources.
Still, with the opportunity to greatly expand your sales and profit potential, international expansion may prove a worthwhile investment for your business.