Are you an entrepreneur catering to a huge domestic market? Do you think it is huge enough for you to achieve your aspirations for your startup? I am sure it isn’t. For growth-minded and passionate entrepreneurs out there, the world is their oyster. Seeking international growth by going global as an importer-exporter offers plenty of opportunities. But dare I say, it is a huge feat in itself.
Many startups consider expansion into international markets as a natural growth progression. According to a study, startups from countries with populations lower than 50 million tend to reach an intnernational audience in about 1.4 years. This is twice as fast as startups from countries with a population of more than 50 million, which typically reach an international audience after about 2.8 years. But that shouldn’t deter startups from large countries like the US or India to expand globally. Going global has many advantages that startups should take note of. Here are 7 reasons to take your startup global:
1. International Recognition: Why limit yourself by the boundary of your country when your brand has the potential to get international recognition? It will boost your sales in no time if audiences from all over the world see your product and have good reviews about it. Word-of-mouth marketing will also play a huge role in the sales of the product abroad and also establish your credibility internationally.
2. Access to global talent: Different countries have different cultures, education methods and values. The way people think or come up with solutions also varies across geographies. Having global talent in your team will help to broaden the horizon and perspective while problem-solving.
3. Increased revenue potential: After companies exhaust growth opportunity at home, they think about global expansion to further grow their business. International expansion allows companies to gain access to millions of customers and thus increase their revenue potential.
4. Boost profits by saving on costs: This strategy is used by almost every other company. Be it outsourcing or setting up factories in countries with cheap labour costs and affordable talent, businesses are always looking for ways to lower their operational costs and save money. This helps to boost your profits and reap benefits.
5. Dodging Fluctuations: All businesses are prone to various destabilizing fluctuations based on the industries they serve. These can be attributed to seasonal changes, political instability, inflation, demand cycles etc. In such a scenario, businesses can even out their sales by catering to markets with different or counter cyclical fluctuations. This also gives you a chance to diversify and stabilize your revenue.
6. Competitive Advantage: Moving into unsaturated markets is the best way to stay ahead in the competition. Expanding abroad will allow you to get out of a saturated market and get new customers in a market where your competitors have not yet reached.
7. Government Incentives: There are numerous countries that offer incentives to companies looking to expand their operations internationally, for example – lowered taxes after deductions, subsidies etc. Recently, the Indian govt. launched the production-linked incentive (PLI) scheme for smartphones and other technology-driven sectors. This is supposed to drive leading international companies to set up their manufacturing units in India.
While the idea of going global might seem very exciting, it pays to take a step back and think more rationally. Even if you think that you are ready to take a flying leap and land in a different country, you never know, the land might be a bit too rocky for you. Before you begin your global initiatives, make sure you have a robust strategic plan that will make your dreams of globalization a reality.
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