While technology arguably gives any business the potential for a global presence. But expanding a business overseas needs careful thought about how exactly to set it up, if the potential for failure is to be avoided.
With the rise in remote working recently, many SMEs have opted for the use of Teams/ Zoom etc. to expand their presence to international territories, but we still believe that it is important for businesses to have a physical presence in a country when they are doing business, as there are many more factors to take into consideration that create the success factor. The challenges in global expansion are significant with complex matters to consider, like understanding the ‘cultural norms’ in that territory and the need to build relationships with the customers in those markets.
On that point, for many businesses it is all about relationships and the services they provide to their customers. The quality of services provides credibility and by developing strong relationships confidence from key customers, in your business, is increased. As in all of the most successful commercial relationships it is all about understanding and then fulfilling the needs of your customer – this is far more easily done when you are ‘closer to the market’ and ‘action’ than being remote, a little distant and reliant on technology to make that connection.
Our view is clear in saying that having a physical presence, in some way, in each territory is essential. But not just any physical presence. You must engage the right people whether that be Employees, Partners, Agents or Distributors. These people will be the customer facing aspect of your business. They will provide the key connection to your new markets so take plenty of time when choosing them to ensure that these appointees share the same values and goals for your business. Values are crucial in all of this – your appointees must be on the same page in terms of how they feel about the commercial world and have the same business principles as those followed by your business otherwise you will deliver very confused messages to, what will become, ever more confused customers and progress will be slow.
It isn’t just about you ‘opening up’ in these new potentially lucrative international markets – think your expansion plan through carefully and evaluate each territory fully before making the leap. Recognise that for you to create a serious international business to compliment your UK business you have to be serious about it. You must put your full focus and effort behind it with the right people engaged. Without the right structure your efforts will fail for sure no matter how good your products or services.
Be totally focused when appointing Distributors, Partners, Agents or Representatives who will be required to make the ground in those customer sectors that you know you want to succeed in. This gives you the best chance of success.
Understand the market that you are trying to get into. Being physically present in a market or having a pre-conceived understanding of the demands and needs of your customer base in that market are crucial in this regard.
Recognise that you may need to adapt your offer for different markets. It is all about how you might appeal to the specific market and to do that, have an understanding of what really appeals to the end users in that specific market.
Summary
The potential can be enormous and naturally it can be very tempting. After all there are thousands and thousands of potential customers based in various regions all over the world aren’t there? However, it is important for businesses to thoroughly understand the detail when it comes to selling and marketing their product or services overseas. Having a vision is great, but it is also important to take one step at a time and focus on the detail. Think about laying one brick at a time to take full advantage of the potential. Understand that expansion may well be hugely profitable if you get it right, but it will carry a cost which should all be factored in during your planning. Run the numbers and play through two or three scenarios. Know what you are dealing with in terms of manufacture, logistics and customer requisites/ terms of trading (for example customer payment terms) etc.
The vision should be big, but the steps to get there should be small. There needs to be a recognition that taking short cuts could be very expensive.