In the global economy of the 21st century, many small and medium-sized businesses are taking the step of expanding internationally. Going global is no mean feat: For emerging businesses, it is a complex process that may be daunting, but can also prove fiscally and culturally rewarding.
It is crucial for business owners and leaders to take the right steps when going global in order to avoid harmful mistakes. Incautious planning or a poor understanding of international markets can be a company’s downfall. In order to take the right steps, here are some helpful tips about expanding a business globally:
- Perform due diligence
Be meticulous when performing due diligence: Carefully consider market opportunity and how it will impact your business. You should perform analyses on local market segmentation, comparable local products and local competitors.
Develop a localized strategy that is specific to the market’s cultural, governmental and economic conditions. Your strategy should integrate localized objectives into overall corporate success. Determine your sales model and methodology, and create a comprehensive marketing plan.
- Build a team
Some companies unsuccessfully attempt to build a team of locals or work with an executive from a parent company. Instead, consider using interim senior executives while you continue to build the right permanent team.
- Be prepared
Be prepared organizationally and legally:
- Review local regulations to ensure compliance
- Ensure that all relevant documentation is complete
- Localize your product if necessary
- Test quality based on local standards
- Initiate a patent review
- Develop localized policies and procedures
- Consult a business attorney to assist you
- Prepare taxes
Corporate taxes become even more complex when a foreign entity is involved. Adhere carefully to local corporate policies, and consult a business attorney to cover all your bases.
- Develop a budget
Once you have sufficient data regarding your foreign company, develop a budget that is ambitious but practical.
- Create ties with local companies
A crucial step for success will be working effectively with local businesses. Support fellow businesses, create alliances and help develop a strong economic ecosystem.