Business expansion covers a wide range of activities. Expanding your company could simply involve working with a new payment portal, or to add a new section to your website. It could also mean adding a new product to your line, that’s supplementary to your current offering and provides great value to your customer!
And then come the big expansion plans that many business owners dream of: growing into another country.
It’s these expansion efforts we’re going to focus on here. After all, they tend to be the most difficult of any and all growth a company can go through, and many good businesses have been lost to a poor expansion strategy in the past.
Team members can drop out, new products can be far less successful than first thought, and the new client base you were dependent on picking up just doesn’t seem to exist. All of these factors can spell disaster, especially if your company has to tangle with all of them at once.
However, the more foresight you have about the boxes you’ll need to check and the structures you’ll need to set up, the more successful your global expansion steps will be. So, to answer the question above: could expand your business to another country? Yes! But you’ll need to consider all of the points below beforehand.
Have You Identified a Market?
The very first thing to always be sure about! If you want to expand your business into another country, you need to identify a market for your business and the product or service you offer. Without this research on your side, you could simply just be throwing money away on a venture that will provide very little in the end.
To ensure you get all the facts you need on the international market, pay attention to where your customers are coming from. Maybe you already ship internationally, but now you’re hoping to expand physically? Where do the bulk of your non-regional or non-national customers shop from?
If you operate in the UK, for example, this could be the US, or countries like Australia and New Zealand. Clearly define demand in the country you’re thinking of before you do anything else, and any challenges you run into from here on out are more likely to be worth the time and trouble.
Cultural Differences Can Take Some Getting Used to
Working in another country will be different to working in your own country. Even countries that are geographically close and seem quite similar, like the US and Canada, can have very little in common when it comes to the workplace.
That’s why you need to be careful about your working practices, and whether they’re going to be successfully applied to a new location in another part of the world. Sometimes it isn’t a problem, but most of the time it doesn’t really translate, and it’s better to get to know the working practices on the ground.
Of course, this can take some getting used to on your own part, or on any employees who have moved from your first location to this new one. That being said, working with a local hiring company could make it much easier to get an overview of working attitudes and expectations in your new area, and it’s best to look into local business trends over the past decade or so.
For example, what kind of employee contracts are most common or widely used? Salary expectations, views on overtime, and benefits packages could look very different to what you’re used to as well.
Communication Can Be Difficult Across Time Zones
Time zone differences can make it quite hard to keep communication on an even keel. You could be having breakfast and be just about to head into work yourself, but your secondary location on the other side of the world could be fast asleep. After all, it’s the middle of the night, and there’s no chance you’ll be rousing anyone on a work call right now!
Getting to grips with time zone differences is key to communicating in an effective manner. To begin with, be sure about the hourly difference and how that changes the pace involved in passing messages along.
Of course, you can always leave messages to be picked up later, but usually it’s best to factor in the whole 24 hours you have, and understand that you’re likely to be on a 12 hour delay at all times.
When you keep that in mind, you’re more likely to have staff available at these later hours, or have flexible working times that keep your company on a loop that moves as it needs to.
Hire From the Local Applicant Pool
If you’re going to be operating in the global market, you’re going to need some employees on the payroll in the specific markets you’ve expanded towards. After all, those cultural differences we mentioned earlier can really get in the way of productive working, and it can be a struggle to ask someone from your native country to go over and ‘head up’ the new location on their own.
As such, you’ll need to hire from the local applicant pool. This is a boon for both your business and the local economy, thanks to the new jobs you’ll be creating, but we know the hiring process can seem a little intimidating.
One big problem that may occur to you immediately is that, if you’re going to operate in a country that speaks a different language to your own, communication may once again become a sore spot.
To solve this issue, you may wish to make an early hire, i.e., a manager for your new location that speaks multiple languages. They can then oversee operations overseas while also reporting back to you – without a chance for miscommunication, mistranslation, and with complete clarity.
You can also work with a document translation service during the hiring process. Indeed, if any resumes cross your desk that have been written in a different language, you can have them translated without any issue.
Not only does this make it easier for you, but it also ensures you can access as much of the diverse applicant pool as possible. After all, you don’t need to stipulate that you can only hire multilingual candidates!
You’ll Be Up Against Different Competitors
You have competitors in the same niche right now, and you know who they are, what they do and how they do it. When it comes to expanding to another country, however, you have to go back to square one here.
Make sure you’re aware of the way the niche you know and love operates in another region. Things could be very different, and most of all, the competitors you have to contend with may be more numerous, or have larger market shares than you’re used to.
They could also have much more of an established brand reputation than your own company does. Even with your own share of customer traffic from this location, this can be a hard head start to overcome.
Tax Structures Vary
The tax structure you’re used to, which you’ve spent years carefully accounting for and paying, is only going to apply to your new location in a secondary way. If you’re going to be operating in another country, their own tax (and legal) structure is going to apply, although there may be a threshold you need to break before you have to pay out across the board.
As such, be sure to research the taxes you’ll be subject to and make sure you understand the basics. You can then work with an accountant who has international experience, if need be, and you can also get in touch with business advisors in your desired location. They can provide actionable, down to earth advice in those moments when the numbers are just all getting on top of you!
Expanding Internationally: What You Need to Know
When taking your company into the global marketplace, you’re going to be up against some very significant risks and challenges. There are ways through these things, of course, but you need to be prepared for the problems that lie ahead.
Firstly, ensure that your business is ready for an overseas counterpart. You need to move into a market that has room for you, that has plenty of demand that you can supply to. Without this guarantee in the first place, you’ll need to wait until your opportunity truly arises.
Then, be sure you’re aware of the legal structures of another country, and try to be as compliant from the beginning as possible. Get this right and your move into the international scene will be as smooth as can be!
But above all, be ready for things to go awry, for mistakes to be made, and for the same issues to crop up time and time again. It’ll take time to iron all these things out, especially if you cannot travel as much as you’d like to!
