In my previous article, I talked about 7 reasons to take your startup global. However, expanding into other countries doesn’t just happen. It takes a long time to research, understand the market, laws of a foreign land, and deal with significant challenges and risks. You probably have numerous questions and don’t know where to start with your planning.
Here are some key questions you must ask yourself while getting started –
- Is my product well suited for the targeted culture? – Every country’s culture is different and so are its markets. Big multinational food chains often change their whole menu when opening up in a new country.
- Does your target market know about the product or service? – It is essential to understand your potential consumers and their awareness about your product.
- Do you know the country well? – You have to carry out extensive research about the country as you might temporarily have to relocate there. You will need to acquire a working knowledge of the language and culture.
- What is the infrastructure like? Infrastructure includes roads, accommodation, ports, supply of electricity and water and much more.
- How stable is the government politically? – The Govt. of a country plays an integral part in the prosperity of your business. It has the ultimate power to make or break it. Thus, it is crucial to ensure that the Govt. of the country is stable and supports foreign business entrants with incentives or providing the right business environment.
These questions are definitely not enough. There is a big world out there. Extensive market research will play a significant role in making the right decisions for your business.
After you’ve asked yourself the above questions, it is finally time to get cracking. Here are some basic steps to get started:
1. Prepare an international business plan: This is the first and primary step to start with. Set your goals and expectations and accordingly evaluate your needs to achieve them. The business plan for the domestic market and international market might differ. Make sure that you are committed to expanding your business.
2. Conduct foreign market research: Hire an excellent team to do this research and identify the international markets. The research shall include all the important aspects like target market, laws and regulations, competitors and prices among others.
3. Product distribution method: Find out about various options for distributing your product abroad. There are multiple options like opening company-owned foreign subsidiaries, working with agents and distributors or setting up a joint venture.
4. Access to capital: Prepare a long-term financial plan. It will help if you have enough capital for the initial investment. And if you don’t, find out channels from where you can raise that money. Look for government and private funding sources and figure out ways to make sure you are getting paid.
5. International Networking: You can consider leveraging influencer relationships in foreign markets. Look for influential people who resonate with your product/service and build a strong network. Building relationships with partners or mentors abroad will especially help when you are finally about to launch in a new country.
These were just five best practices that will help you navigate the risks and challenges you might face while going global. If you go into the expansion process with the right goals and a great team, you’ll be most likely to succeed in the long run.
For more extensive analysis and Market Intelligence reports feel free to approach us or visit our website: Venture Capital Market Intelligence Reports | VCBay.
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