The Ultimate Guide to Global Expansion
While about 20% of small businesses worldwide fail within their first year, there are actionable strategies that can stop you from falling into this sad statistic. One of the best steps that you can take towards success is expanding your clientele, and this is much easier when your business expands internationally. After all, there are billions of people who may need services like yours abroad!
Here, we’re going to talk about global expansion and give you some tips that can help you succeed. Read on for some global expansion strategies that will have your business reeling in more money ASAP.
What Is Global Expansion?
Global expansion is the process that a business undergoes to expand to other areas of the world. While you currently operate in a market near you (your home market), global expansion also lets you move into a foreign market (your target market).
The process of global expansion isn’t one-size-fits-all. You may undertake expansion differently than even other businesses in your industry.
For example, some companies prefer to expand one region at a time. This might mean moving a business from North America into Europe right away. Later, you would consider moving to Asia when operations in both North America and Europe are strong.
Other companies might prefer to expand to multiple regions at once and get the ball rolling immediately on multiple continents. An Australian company may immediately try to gain traction in North America, Europe, Asia, and South America at the same time.
The Benefits of Expanding Globally
The biggest advantage of global expansion is that you have the opportunity to work within a new market.
While your current target audience only consists of people in your own region, there are billions of other people in other parts of the world. Many of them likely have need of your goods and services, so you can exponentially increase the number of people investing in your business.
The more you grow, the less it will cost you to operate elsewhere. For example, Walmart is one of the largest companies to operate internationally and is worth about $365 billion USD. When they open a new store abroad, the costs are comparatively nothing, which showcases that growing your business abroad makes you able to cyclically sustain large-scale operations.
International Financial Incentives
In addition to the ROI that comes with a larger market, foreign businesses also get many incentives from developing markets.
An example of this would be India cutting taxes on foreign tech businesses by 8% when they chose to operate within their tech market. In India, operating a business based in Britain may cost less than operating within the UK. Since you can simply have remote employees work to expand to India, you won’t even need to export your workers or buy another office location.
Diverse Ideas and Perspectives
Financial benefits and a high ROI aren’t the only things that you get upon expansion. You also gain access to invaluable knowledge about your market and your services. When your employees understand and work within your market in other nations, they will better see trends in what people invest in and why.
This can help you to curate your products more for international audiences. It spurs innovations. You can also likely apply dips and peaks in trends in other countries to worldwide operations since markets tend to follow similar patterns cross-continentally.
Additionally, people in different regions have various ideologies pertaining to business. When you get more of these perspectives, you will consider unique, otherwise unexplored ideas that could benefit you to implement.
The Top Global Expansion Strategies for Businesses
As we said before, expanding globally isn’t one-size-fits-all. Before you can discuss expansion, you will need to consider what strategic model you want to use when moving abroad. You have four general options here:
- International strategy, where you export and import goods and services to other countries from your head office in a single home location (generally the most popular and successful model)
- Transnational strategy, where you have a head office in one country and local stores/subsidiaries in international markets
- Global strategy, where you define a single global brand and sell the same products everywhere (making no changes for other markets)
- Multi-domestic strategy, where you would use completely different product/sales/marketing strategies depending on the location that items are being sold (usually expensive and ineffective for beginning expansion)
Once you understand these possibilities, you can come up with a more specific plan of action.
Choose What Markets to Expand To
After selecting a model for international expansion, you need to choose the right markets to move into. Research the regions that have the greatest demand for goods and services within your niche. If you can supply a service that touches on these pain points, this is an area worth looking into expanding to.
Look into cases in which companies in your niche expanded to a specific area. Follow those that succeeded. They’ve paved the way for you to get in with that market since people will already have some basic knowledge of what you offer.
Consider Remote Work
About 68% of employees prefer remote work over other alternatives, so those that don’t offer this option are likely to be left behind in 2022. However, remote work is ideal for international expansion for other concrete reasons as well.
You can expand into new regions without setting up a physical office. This saves you the costs associated with renting out a physical space. You also won’t need to pay stipends to employees that you send out for international work.
When you allow your employees to work remotely in their home territory, you also allow them to stay in an environment they understand. They will be able to better perform research and apply principles from their home turf to international sales.
You can also begin expansion immediately. There’s no need to worry about employee or company logistics.
Begin Growing Your Business Across Country Borders
While global expansion can be a challenge, it comes with great payoff. You’ll get to enter new markets, build more professional connections, and adapt to a larger community like never before. Now that you have read the complete global expansion guide for businesses, it’s time to get started.
We’re committed to providing you with hassle-free tools and expertise to expand across the globe without physical offices. That’s why we’re excited to help you come up with an action plan that meets your individual specifications. Contact us to begin inquiring about the ways that you can quickly expand overseas and succeed worldwide.