Global expansion became integral part of business strategy for many companies. In spite of that, there are many businesses that have all the means to succeed on global scale, but have lots of doubts that stop them from expanding their business across their country’s borders. Number of US companies that are selling their products overseas is constantly growing. In 2007 these companies sold more than $1,1 trillion worth of products to consumers abroad and in 2013 this number reached unbelievable $1,9 trillion.
Most companies that sell their products globally are big enough to cope with all difficulties that come with this kind of trade. Unfortunately only several percent of small businesses will even consider offering their products to consumers in other countries. Currently small businesses cover only 30% of US exporting volume, although the number is growing due to huge growth of e-commerce.
In this article we are going to provide you with step-by-step guide for international commerce that will help you to grow your trade empire across the seas and beyond.
Step 1: Choose Foreign Market
Choosing international market to expand is one of the most important decision to make during expansion process. There are several important steps that should be taken, that will help you make this decision:
- Determining countries with high interest in your products (look for foreign nationals who were interested in buying them online)
- Considering cultural and language differences
- Researching local economy, politics and legislation
- Inspecting possible trade barriers or additional costs.
Step 2: Conduct Foreign Market Research
Market research provides you the information about segments of oreign market where company’s goods will be sold. It also gives you an insight about possible competitors and their most common business practices. Determining the price of your products is impossible without broad market research. When doing the research, companies should use everything they can lay their hands on, including: contacts with consultant and government agencies, books, free internet sources, consumer interviews, export specialist data, foreign market statistics and news etc.
Step 3: Create an Export Strategy
To complete this step, companies need to create an elaborate export plan that will take into consideration even the smallest details. It should deal with financial as well as practical part of company’s export venture. Two main ways to establish an international trade are:
Assembling an international sales team- these teams can be built by creating partnerships, alliances or personal contacts with retailers on the desired market. It’s important to find trustful partners, and this can only be achieved by listing hundreds of local companies and professionals and contacting them directly or through local recruitment agencies.
Selling products online- internet is one of the best international sales channels and if company already has an e-commerce website, it only needs to optimize it for the market on which it wants to expand. Some companies also decide to build a completely new website, and they need to invest little bit more money for making it optimized for search engines. AdWords and social network ads are great way to popularize an e-commerce website on the new market, plus there are numerous other ways to do that with: TV and radio commercials, billboards, event sponsorships etc.
Step 4: Build Shipping Routes
Shipping is one of the most complicated aspects on international trade and that’s why companies need to develop strong shipping routes and cooperation with logistics companies. Depending on the products companies are exporting, they sometimes need to have local based storages that will be filled with ordered goods that require special storing conditions. Since building a regular storage in countries where companies want to expand is costly and time consuming, they need to use some alternative methods. Great example of an alternative storage comes from New Zealand, far-away country that largely depends on product import, where company called Royal Wolf made a self storage facility that enables clients to store their goods in reused shipping container.
Borders are just imaginary lines drawn by politicians, therefore limiting your company’s business to domestic market, when you have all the means to go far beyond is pointless. Entrepreneurs who are brave enough to expand their business worldwide, one day or the other will enjoy all the benefits that come with international trade.