There are two emotions that you may experience when you start the journey to take your brand global. You may be excited about the business adventure that will give you new markets and diversification as well as make you less dependent on your local market. But you may also experience some anxiety that you are going into an unknown market that may be risky. Let that anxiety point you in the right direction to prepare well.
To make the most of the global opportunities available to you, and to mitigate potential risks, here are the top 5 tips to taking your brand global.
1. Do Good Research
Various factors need to be understood before moving into a new territory over and above the obvious business elements. The political regime, how stable it is and how best to work within it, is an important first step. You need to understand the extent of local, government and international competition both in direct product comparison as well as alternative product options already in the market. Ensure that you understand the nature of brand loyalty in the market – how strong is the existing cultural attachment to a brand or product, and on what basis can that loyalty shift – would it be for price, status, convenience, novelty etc?
Currency issues, exchange rates, and payment gateways need to be understood in the research phase.
Researching a new market can be daunting but once you find a market that you are interested in, you also don’t want to take 2 to 3 years preparing to enter it. Ensure that you have a good partner to assist you.
2. Understand Local Culture
In spite of our access to so much more information about other countries, successful cross-border business means that you need to understand the culture of the country you want to do business in. This requires more than just reading a tourist guide to body language. Invest in sending your senior team to spend time in the new country or working with local partners who will guide you in your business expansion.
In terms of business communication, it is important to understand that there are fundamental differences between how people in the West and East think and communicate.
Westerners (typically north Americas and Europe) think in a linear, cause-and-effect fashion while Easterners (Asia and China) think in a more cyclical or spiral manner, seeing seasons and repeated patterns.
Westerners are more overt in their communications, stating their positions clearly as well as being more inclined to decline, or say ‘no’, very clearly. In contrast, people in the East are typically more concerned with the recipient’s sensibilities, so much communication needs to be inferred because it is subtle or expressed non-verbally.
Rule-based Westerners are often contrasted with context-aware
While these are generalisations, Western business people often don’t understand the extent to which relationships, social dynamics and status influence business decisions in the East.
It is essential that sufficient value is placed on this part of the business expansion process.
3. Familiarise Yourself with the Local Business Laws
Your business may be doing well in your home country, but when you start operating in a new country there are a host of financial, legal and business questions that need to be answered:
What international business, trade and tax structures need to be in place to operate in a new country?
What employment and HR practices need to be understood to comply with local legislation?
What potential advertising, networking or business relationships that might be acceptable in your home country might be considered inappropriate in a new country?
What entrenched businesses or infrastructures would your product challenge or disrupt and to what extent might the local establishment react to protect their interests? Recent experiences can offer some warning. Airbnb is not allowed to operate in some countries or strictly regulated and Uber’s London licence was pulled because their operations challenged local operations.
Failure to anticipate and familiarise yourself with these laws could result in business and financial losses.
4. Formulate an Entry Strategy
A strong entry strategy will include obvious elements such as budgets and marketing plans as well as infrastructure and staffing issues and timelines as well as what business partnerships to explore. Timelines are important as a company should match their budget with how aggressively and quickly they want to pursue a new market. But most important in the entry plan is a timeline with alternative options and key indicators of success and failure that can be used to address decisions about the direction a company should take.
5. Find the Right Partners
A venture with as considerable an investment in resources as cross-border business will have a higher chance of success if explored with the right partners. Local partners already established in business, legal, logistics, warehousing, marketing and finance can go a long way to making your business venture successful.
If your plan is to expand into China, then consider partnering with Kinofy. Yes, that’s us! Coupling our knowledge of the retail landscape in China with our proprietary social commerce infrastructure platform, we provide speed-to-market solutions for businesses looking to build their foothold in the massive China market.