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10 questions to ask before expanding overseas


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Deciding when to go global is a tough call for entrepreneurs. They may be tempted by opportunities in hot markets like China, India or Brazil, but could risk venturing abroad before they’re fully prepared.

While selling overseas extends your company’s reach, you don’t want to move into international markets too soon and use resources you need to continue growing on your home turf.

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10 questions to ask before expanding overseas

  1. 1. 10 questions to askbefore expanding overseas
  2. 2. Introduction Deciding when to go global is a tough call for entrepreneurs. They may betempted by opportunities in hot markets like China, India or Brazil, butcould risk venturing abroad before they’re fully prepared. While selling overseas extends your company’s reach, you don’t want tomove into international markets too soon and use resources you need tocontinue growing on your home turf.
  3. 3. a. Have I built a solidfoundation at home? Make sure your business is stableon a day-to-day basis beforepursuing overseas markets. You should determine whetheryour business could function wellin your absence. Companies also need to have thedistribution running smoothlyenough so that they don’t have tofocus on it constantly.
  4. 4. b. Do I have the bench strength forinternational expansion?You will need to assign one or twosenior employees to yourinternational effort. You need todetermine whether you can affordto move people from their currentresponsibilities, as well aswhether they bring–or can quicklydevelop–the necessary skills foroverseas sales and marketing.
  5. 5. c. Will I find the talent I needin another country ? If you decide to expand, finding localtalent can be a challenge. Somecountries simply do not haveenough of the skilled laborcompanies may need. You also will be competing withestablished companies that knowwhere to find talent and how torecruit local candidates. One potential source: localeducational institutions such asengineering programs and businessschools.
  6. 6. d. How will I need to adaptto the local culture? Some countries such asFrance and Japan expectcompanies to adapt to thelocal culture. That may mean customizingyour product or service tomeet local customers’ tastes. At the very least, you willneed to put your marketingmessage in the local languageand make sure the meaningtranslates correctly.
  7. 7. e. Do I understand the culturalimplications of the sales process ? Closing a deal abroad can be a vastlydifferent experience than you’reprobably used to. Some culturesstruggle to say, “No, we aren’tinterested” in a product/service,which means you can have anextremely long and costly salesprocess that never leads to a sale. To avoid this problem, look forcustomers who have bought similaritems or services in the past. Andsometimes it’s better to cut off talksif they lag for too long.
  8. 8. f. Have I sized up thelocal competition ? Understanding your competitorsabroad can provide insights intohow – and whether – to expand. Many companies don’t take timeto figure out whether similarproducts and services are alreadyavailable in a new market andwhat they would need to offer tocompete successfully. Spending time abroad andspeaking with potentialcustomers can help to avoidcostly mistakes.
  9. 9. g. Do I need aninternational partner ? For many companies, it’s criticalto find a local partner whenexpanding overseas. Partnerscan help facilitate sales, whilekeeping costs down for thehome office. Forming a partnership takestime – often, a year or longer –and requires plenty of duediligence to find the right fit.
  10. 10. h. Am I financially able to sustainan overseas expansion ? Expanding internationally requiresa start-up-like period that’s longerthan many entrepreneursanticipate. You have to expect to lose moneyfor a while. So, you not only needenough capital to make the initialinvestment, but you also shouldhave a long-term financial plan inplace. You will likely need to update theplan to reflect actual revenue andexpenses as you ramp up in thenew market.
  11. 11. i. Where is the potentialfor red tape ? Expanding beyond the domesticmarket can mean lots of extrapaperwork, especially formedical and technologycompanies. With such a variety ofregulations surroundingexports, it’s important tounderstand what’s required foryour particular industry beforeattempting to expand abroad.
  12. 12. j. Should I simply expandmy online presence ? For some companies with a strongwebsite, it may not be necessary toestablish a physical presence abroad. You may be able to offer overseasshipping and expand payment optionswithout the hassle of extensive taxregulations. But at least in some markets, youwould need to develop websites inanother language that accept the localcurrency. Online shoppers are morelikely to buy when the experience is intheir local language [and] localcurrency.
  13. 13. More...• Free webinar: « Step by step for exports »This webinar will help you to learn about the world marketplace and how your companycan do business there. It concentrates on the overall principles of exporting anddescribes the processes that businesses commonly use to develop export strategiestailored to their needs.• To register:• On line training : "Practical aspects of international trade »The objectives are to familiarize contractors, manufacturers, exporters, importers, tradersand service providers a comprehensive view of international trade. Short-term trainingwill help to clarify and develop the skills to act locally and abroad in foreign countries.• To register:
  14. 14. Contact usSite internet: Facebook:International Trade Training CenterID Twitter:ITTCcanadaID LinkedIn:International Trade Training Center ITTC