Today’s international market calls for international action, yet the US Department of Commerce reports that less than 10% of American companies in the manufacturing and service sectors engage in global trade. But whether you like or not, you are perhaps already competing with foreign-owned businesses in your local markets. With that in mind, you can also expand your business on a global scale by using your competition as a resource.
Read on to see how you can take advantage of your competition to grow internationally.
Do in-depth due diligence
Before expanding internationally, it is important to know how your business will be affected.
- Carry out a market segmentation analysis to find out if there are potential customers for your product in the domestic market.
- Find out if there is unmet demand in the local market by performing a product gap assessment against domestic products.
- Do a thorough SWOT (strengths, weaknesses, opportunities and threats) analysis against your competitors. Find out if the market will purchase your products if they are a bit expensive than local ones.
- Study the market opportunity/sizing. Determine the size of the market and the possible duration you will take to achieve your targeted sales.
Come up with a localized business strategy
Each market is unique – it has its own differences because of cultural, governmental, economic and market conditions. So it is imperative to create a localized business strategy that steers local success while staying aligned to the overall company strategy and objectives. A good global business strategy should define:
- What draws you to international trade
- What import/export pricing plan will you embrace
- Your prospective export markets and clients
- How you will tap into the foreign market
- Expected extra costs, including marketing, sourcing, traveling, and shipping
- Anticipated revenues
- Sources of funds to fund your international expansion
- Legal requirements for entering your target market. For instance, if you’re planning to expand your business to the US, you need to apply for a visa, that is depending on your country of residence.
- Goods transportation
- Whether you will venture into foreign partnerships or investments
Study your competition
Now that you have identified your target local market and put in place a localized business strategy, it’s time to know your competition. Identify your competitors, their offerings, and their strengths and shortcomings. This way, you will find out the areas you must focus your time and resources on. It will also help you develop strategies for differentiating yourself from your competitors.
Make your products ready for the market
Relying on the product gap analysis, prepare your products for the market by taking the necessary steps.
- Examine government regulations as well as industry-specific ones to make sure compliance and approvals are obtained if required.
- Find out if your offerings require any localization. Ensure your product’s name is translated correctly to the local language. You can hire a competent localization company to do that for you.
- Start a patent and trademark evaluation to prevent other businesses from “copying” your ideas
- Start testing and quality assurance assessment according to local standards.
- Think about setting a local logistics and distribution channel. Who will be your distributors? How will your product reach them?
Cultural differences, be they language, customs or rules, call for a company to implement flexible policies and procedures that ensure workers are engaged and working toward achieving the company’s goals. Here are tips to ensure your business is ready for global expansion.
- Consider the organization structure required to undertake your strategy successfully.
- Come up with policies, measures, and manuals that adhere to the local requirements while striking a perfect balance with general business policies.
- Come up with competitive benefits plans to pull qualified local professionals to your company.
- Create competitive compensation packages that are in line with local principles and customs.
- Put up a local information technology framework that aligns with the domestic one.
Develop a comprehensive marketing strategy
Invest time and resources toward telling your audience who you are, your offerings, and why they should choose your products. Don’t worry if you have a tight marketing budget. Marketing ideas can include leaflet drops, posters in your window, or social media campaigns.
Using your competition as a resource for growing your business internationally isn’t always an easy thing. But if you continuously focus on identifying new markets, studying your competition and customers, tailoring your products or services to address fluctuating needs, and tapping into new opportunities, you’ll be more likely to operate a successful business that will flourish for generations.