Despite the far-reaching riches and rewards that ‘going global’ could provide small and emerging businesses with, any expansion effort requires a lot of careful contemplation.
Business owners will need to exert more effort than before. From analyzing the market, identifying the gaps, reviewing what went right, and what could have been done better. Also, all company expenses must be reviewed as well, such as the involved cost to produce or procure your product and your employees’ paychecks. And when we talk about paychecks, business owners also need to consider what needs to be shouldered by both the employer and employees. Take federal withholdings as an example and one of them is knowing about FICA. FICA is also known as the Federal Insurance Contributions Act, a federal tax for Medicare and Social Security. These are just a few of those things that business owners should consider when planning to expand.
After all, going global will inevitably disrupt existing day-to-day activities and could even cause a business to fall off its established pillars of success.
Therefore, business founders and owners wanted to go global must understand its full impact and determine whether the potential rewards outweigh the risks.
Perform in-depth due diligence
In order to effectively manage your expansion, you must first understand what impact it could cause the business. This means analyzing things like market segmentation and product gaps as well as strengths, weaknesses, opportunities, and threats (SWOT) to find out whether your business can compete.
You’ll also need to assess the market opportunity and sizing to come up with projections about how long it could take to secure your targeted sales.
Create a new business plan
Just like when you first started out, it makes sense to develop another strategy and business plan. This should take into account the different economic, cultural, governmental, and market conditions in the countries you’re targeting.
You also need to consider the technical aspect when you are creating a business plan.
Your localized strategy and plan should define both short and long-term goals, detail any changes to your business model or structure, and set forth a top-down annual budget.
Ensure your product or service is ready to go
After analyzing the market, you’ll be in a position to make necessary changes to your product or service and ensure it’s ready to go. This is likely to include government or industry-specific regulations along with other localization requirements such as translations.
You may even need to initiate patent and trademark reviews as well as testing and quality assurance. Then come a local logistics and distribution network, which will be much easier with inventory management systems that can link up with your existing database back home.
Get Your Website Localized
If you want to translate your website into different languages, a poor translation job could make your contents look awkward. There are cases where embarrassing translation mistakes have turned off foreign customers, this is where localization jumps in.
Localization is the combination of translating and localizing an article while keeping its meaning. Localization is a skill that develops over time, so it is essential to seek the help of those who offer localization services to avoid blunders and ultimately, maintain that reputation you worked so hard to earn.
Identify and employ the right team
If you want to hit the ground running, consider using proven employees in the interim before building a local team. That way, you can quickly validate assumptions and drive key readiness initiatives.
You’ll also need to be flexible when it comes to the company culture due to language, regulatory, and customs differences. This calls for evaluating the organization’s structure, developing localized policies, and managing human resource functions.
Get your finances in order
Accounting responsibilities and tax requirements can be difficult enough in your home country, let alone in a foreign land. Therefore, tax and finance infrastructures should be set up as far in advance as possible to guarantee timely reporting.
Many businesses that go global often find it easier and more efficient to outsource accounting, payroll, and tax. Third parties with local knowledge may also be able to help you with risk management, pricing studies, and a cash repatriation plan.
Making a success of going global
It goes without saying that going global isn’t for the fainthearted business owner. But those with ambition and enterprise won’t be able to ignore the immense growth opportunities that exist around the world.