Expanding your business apertures takes time, resources, and money. But what if we’ve told you that you can do it effectively with the right business expansion strategies for reaching global markets?
Embracing globalization means adapting to foreign markets, implementing practices for scaling your business, and increasing profitability. In order to expand your business internationally, you will need a global expansion strategy that outlines how the company will expand internationally to enhance revenue growth.
In this short guide, we’ll talk you through the key global expansion strategies and how you can get the most out of each. And since creating a successful strategy is pretty challenging, it’s not impossible, so let’s dive in!
Set Your Goals
The first step toward counting international successes is to identify your company’s goals. This will give you a clear perspective and a direction in the short-term and long-term on how to operate the business sustainably.
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Setting your goals will help you identify the potential expansion areas and whether you can achieve them in a given timeframe. However, you need to consider certain factors when expanding:
- To save more money by outsourcing
- Build a recognized brand
- Diversifying markets
- Expanding into new and lucrative areas
- Building a diverse team with niche skills
Your goals should be SMART – meaning they need to be Specific, Measurable, Attainable, Realistic, and Time-bound to achieve key results and objectives.
Do A Research
Once you have identified your goals, it’s time to do your due diligence and perform market research. It can help you identify new opportunities and recognize obstacles before jumping into the expansion. Market research will help you decrease risk, maximize profitability and learn whether there is a high demand for your product/service abroad.
Identify the TAM – Total Addressable Market, explore the cultural and socio-political landscapes, and learn who are your competitors and how you can offer something new and different. Local laws and regulations play a crucial role in expanding your ventures, so you can consult a legal entity on how to overcome legal barriers.
Country-specific databases can help you narrow down the market research and target potential areas for success. And while your goal might be to expand to multiple continents, it’s better to stick with a couple of countries of higher priority before embarking on a different expanding area.
Choose Your Business Partners Carefully
As you move your offices internationally, you’ll realize that new and foreign markets are difficult to conquer. You might not have a clear idea of the local culture, whether your product/service is high in demand, or your business might not be legislation-compliant. Everything will be different, so one of the best ways to adapt successfully is to partner up.
You can find new business partners as you enter new markets and get that overseas success. But how can you find the perfect partner? First of all, you need to develop relationships with distributors or local manufacturers to increase your chances of visibility.
In many industries, appropriate experience is required, so seeking a proper partner requires a lot of research since every country has different cultures, labor requirements, and tax implications. And in case you need assistance with recruitment or payroll, you can work with multiple partners or find a company that will help with all of it.
Reinvesting is essential if you want to grow revenue and finance your expansion into new markets. Moreover, if your company is in the early stages of its growth, you are more likely to reinvest and increase the profits.
You can reinvest in new locations, expand the product offer or increase the number of revenue streams. This way, you can generate more profit and insulate your business from the risks of having one source of income.
Choose a Lean Approach
A lean approach is introducing a new product on behalf of an existing company. You can easily enter new markets with the lean approach and you’ll have the flexibility to learn what works, how to adapt to the new changes, or how to evaluate opportunities.
The lean approach can help you gauge consumer interest and narrow down the resources for creating and developing your products/services. It helps you define the products, for example, if a product is more likely to fail, it will be cheaply and quickly, instead of expensively and slowly.
Go For Expansion!
These are the 5 global expansion strategies that can work in your favor. So, if you are ready to go for expansion and achieve your financial goals, make sure you get help from an advisor and start your international adventures!