Expand Your Business in a Foreign Market: Diversification and revenue growth can be achieved through global markets. Taking advantage of these opportunities requires careful planning, including timing. You may lose out to your competitors if you wait too long. Your new venture and existing domestic business can both be put at risk if you expand too early.
Expand Your Business in a Foreign Market:
Start local.
Before you expand your business, establish it domestically. Financial and managerial resources are required for expansion. To enter new markets without distracting management or draining finances, your domestic business should generate enough profits and be sufficiently honed.
In order to determine whether your company is ready for expansion, look at the industry in which it operates. In the next few years, will you be forced to significantly change your U.S. product line due to technological advances or a shortage of suppliers? Consider making these changes before expanding if this is the case.
Company dependent.
Depending on your company’s goals and its products, timing really depends once your company is established and stable. It may be best to continue to focus on domestic growth if you still have many growth opportunities in the United States. Additionally, aggressive international expansion may be the best strategy if your product is needed across many geographies, but can easily be duplicated by competitors.
Due diligence
Planning should precede your expansion once you’ve decided to expand. Develop a business plan for your expansion just as you did when you founded your business.
Find out who your competitors are, and what their target markets are like. Costs related to marketing, licensing, and regulation should be considered.
Find out whether there are any potential suppliers, distribution channels, or partners who can be partnered with. Economic factors may require some companies to expand opportunistically, or to find the right partner or sell to a large customer in a new region.
Other factors
Consider whether you want to expand into one new geography at a time or into multiple countries simultaneously as part of your business plan.
Among other factors, you should consider your financial and human resources. The availability of partners and the similarities of regulatory systems, cultures, and demographics in the countries.