Internationalising your business
Expanding your business beyond your own backyard seems like a must these days. As consumer habits become more homogeneous across the world, internationalising appears easier and a natural step in the growth journey. If you have ever considered expanding your business abroad, it is crucial to get to the heart of why you need to internationalise. Your reasons may be reactive or proactive.Reactive reasons include a need to increase sales, diversify risk, reduce cost, or balance-off market saturation. Whereas proactive reasons encompass the desire to gain knowledge about other clients and markets and thus challenge your business by global scale competitors, to increase efficiency of your company and to spark innovation.There’s no doubt that international expansion drives excellence in businesses through the exposure to international competition. However due to the competition this brings, the decision to expand internationally must be feasible. In this regard, there are fundamental questions to ask, through a self-assessment test before your take-off. These are:
- Benefits: Write the benefits down and quantify them (profit, sales, market share etc.)
- Resources: Scrutinize your infrastructure, your people’s capabilities and your product fit on a global scale.
- Cost: Do the math and make sure you have the financial resilience to afford this journey.
Once the internal criteria have been met, a set or external factors need to be considered. These are the ‘must-haves’ and include learning about and understanding the government, tax/legal framework, competition and prospective partners of the country you plan to expand to. Furthermore, you should adopt an international mindset within the entire business and across all teams; be resilient and prepared for a difficult journey, become excellent in what you do, and pay attention to the business brand and company culture since that sets you apart effortlessly. As a business, you have the option of launching globally at the onset, typical of web and ICT businesses or take the path of more traditional businesses and starting nationally before venturing internationally. Both models have their strengths and weaknesses and ultimately, the decision of which approach depends on your business and specific contexts. Becoming global undoubtedly becomes a strong driver of a company’s growth and future. Provided that the company takes its internationalisation seriously and plans well ahead for it.By Lyda Modiano