If you have fine-tuned your business operations on a domestic market, it may well be time to take it to the next level and reach out to a broader, global demographic. There are going to be lots of things that you will need to research and understand when it comes to expanding overseas, however, you may find that for your business, the positive results that you can achieve will greatly outweigh the stress and effort of setting yourself up for expansion.
Is Your Business Scalable?
One of the first things that you will need to ask yourself will be whether or not your business can handle expansion. There may be a great many challenges that go along with expanding your company’s operations to incorporate overseas trade. If there are problems that currently exist that impact the time that it takes to do anything, or that has any negative impact on trade, it is important that you address these immediately before scaling up your operation. Any issues that you have now will be magnified and repeated as your business expands, and you may never be able to eradicate these issues that will have a profound effect on your business’ bottom line.
Researching The Market
It is crucial that you understand everything about the market that you are entering. Try and find out what type of government they have and what their view of overseas business is. Some countries may welcome global brands, while others may be more restrictive to show favor to their homegrown businesses.
Cultural differences should also factor into your considerations. What is the market interest like for your products and services, and are there any historical, cultural, or religious factors that would impact on you being able to offer these in the countries that you are looking into?
Find out who has a similar offering in the market that you are considering. Work out what their strengths and weaknesses are and try and work out the threat level to your business. How well known are those brands, and will you have difficulty attracting customers who may be loyal to them.
Dealing With Strange Currencies
When it comes to financial matters, you will need to understand global exchange mechanisms. You will be dealing with a variety of currencies. You may need to receive payments in the currency of the company and as such will need a bank account that can handle this. You may need to open an account in the country itself as there may be a necessity to do this. Alternatively, you may be able to use global accounts with financial exchanges to transfer money to the usa.
Knowing what the exchange rates are on a daily basis will be important as this will greatly affect the value of your products and services.
You will need to do a great deal of research into all of the areas of regulation surrounding trading within the countries that you are looking at. If you were to purely ship goods from your domestically run website to an overseas customer, what import and export duties would apply. If you were to open up a distribution hub overseas, how would that work in terms of taxes and running costs?
Some markets, such as the European Union will have a set of regulations that will apply to other member states. Understanding the trading arrangements between your country and the ones that you are looking at trading in is vital.
Speak with the trade departments of the national embassies, and do plenty of research into the full costings along with any legal requirements surrounding the products and services that you hope to supply there.
To Have An Overseas Office, Or Not?
Many companies will choose to open up and office in that country. This will help them to manage their business better there as they will be closer to the action. Doing this may open you up to different taxation, however, it may be something that is promoted in the country that you are looking to operate from, and from a purely logistical point of view, it can be beneficial to have a team working out there. Recruiting nationals from that country will mean that they are likely to understand their native market better than you will and can provide valuable insight. You will need to find ways of communicating effectively with that team without you having to spend a great deal of time out there.