10 Steps To Take Before Moving Your Business Ventures Abroad
Taking your business overseas offers numerous benefits.
From accessing an untapped market to gaining greater exposure, as well using the opportunity to rejuvenate and re-evaluate your current business offering, there’s a lot to gain for companies who expand in the right way.
But, there are numerous steps to take before you can even contemplate trading on foreign soil…
1. Define your reason
What’s your reason for venturing abroad? If it’s simply to earn the accolade of ‘cracking’ a particular market, you’ll be way off the mark. And even ‘accessing new customers’ is too vague. Instead, you’ll need a concrete, concise reason for international expansion. For example, do you think there might be a gap in the market for your business? Is an industry building traction over there? Set yourself a goal and work towards it.
2. Establish your measure of success
Next, you need a way of establishing whether or not you’ve actually met this goal. It’s worth giving this some thought at an early stage, as it will go onto form part your business plan and market entry strategy. For example, will you measure success by the number of sales you generate? If it’s global awareness you want to earn, how will you measure that?
3. Consider your current position
International expansion is expensive. According to Foothold America, setting up a subsidiary in the US frequently costs upwards of $50,000, so it’s critical that you’ve evaluated whether or not you have the resources to expand abroad. Get it right and you’ll recoup that $50,000 and earn a whole lot more, but cut corners and fail to monitor cash flow and outgoings and you could find yourself in a very stressful situation.
4. Target the appropriate location
If you’re confident your business can afford to expand; you’ll need to invest time researching where best to venture to. If you have your sights set on the US, consider which state you’d like to settle in (taking into account local, federal and state taxes), but bear in mind that the right location for your business might be somewhere that doesn’t immediately occur to you.
5. Conduct market research
Once you have a specific location in mind to target, you’ll need to conduct extensive market research. You can hire specialists to assist you with this if it’s not something you want to do alone (indeed, it can be particularly challenging to research a foreign market alone, even if it is the cheapest option). You may find this article helpful when you’re ready to get started with this step.
6. Develop a strategy and business plan
Once you’re happy you’ve chosen the right market and your research shows that there’s opportunity for your business, start developing your market entry strategy and business plan. You’ll need a localised plan that works for the immediate, medium and long term (acknowledging that the medium and long-term plans are likely to need adapting in the future). At the very least, this plan should detail your goals, measures of success, the structure of your foreign entity (and how it feeds into your native business) and a tactical project plan.
7. Comply with the law
When it comes to bedding yourself into your chosen country, it’s critical that you’re following the law of the land. This means complying with all of the customs, import/export laws and regulations you’re expected to abide by, as well as completing and filing all the paperwork to establish your subsidiary (or similar entity).
8. Seek professional guidance
You’ll undoubtedly need to seek counsel from professionals who specialise in particular fields, including company law, international tax and similarly complex matters your chosen location. It’s also worth seeking the advice of businesses who have already made the move to the country you’re expanding to, as you may be able to learn important lessons from them before making similar mistakes. Also, consider getting in touch with local government bodies both at home and abroad to see if they can connect you with important contacts to help make your expansion a little easier.
9. Establish your marketing strategy
You can pour a huge amount of time and money into doing everything correctly to this point, but if you forget to design a comprehensive strategy to actually sell your products or services overseas, it will all be for nothing. So, establish your goals, your KPIs and give specific thought to how you need to market yourself in your local environment; your brand may need tweaking to appeal to a different audience, your pricing might be a bigger issue than it is at home, and your sales model may need modifying to ensure you’ll be as profitable as possible.
10. Consider staffing
Who’s going to perform the work when you’re set up and ready to go? You need to decide whether or not you’re going to open up opportunities to your existing staff force (and if so, learn how to acquire visas or permits to work). On the other hand, if you want to recruit workers from the country you’re expanding to, you may need to appoint a third party to assist you with finding, interviewing and hiring the talent your business needs to succeed.
Of course, there’s a great deal more to do than the ten steps outlined above. But, it’s a good place to start if you’re thinking about venturing abroad.
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