Entrepreneurs have vibrant energy, confidence and a clear vision that gives them the boost they need to achieve their dreams. However, these passionate individuals often stand at a crossroads, contemplating the value of earning a Master of Business Administration (MBA).
When a brand fills the local market, they often see room for additional growth and seek ways to reach new customers. Adopting a strategy of international business expansion opens up a world of opportunities and sets the bar higher than most small companies ever dreamed possible.
However, with growth comes challenges most entrepreneurs never expected. Weighing the pros and cons and being prepared to face the pitfalls head on helps companies find success where they otherwise might flounder. Here are the top challenges to be aware of and some tips for overcoming them.
In a report by Kearney, experts mention the battle for technological supremacy between the U.S. and China as something driving global economic growth. The Indo-Pacific region fills the gap in manufacturing and other industries, so plan to work with people from different areas and with different pay structures and cultures.
Do also research the drawbacks and advantages of selling and getting supplies from different countries to find the right mix for a brand.
Every country has different rules and regulations involving doing business internationally. A company might gain advantages by creating a foreign subsidiary, with headquarters in a place other than its home. Others might benefit with third-party sourcing or offshoring.
The best way to get a handle on the tax burden for each choice is by enlisting the help of an international business expansion tax and regulations professional. Figure out what duties the business might need to pay to the other location. Calculate the tax burden in the home country. Choose the best scenario for profitability and to reduce amounts due.
As a company expands, the bias might lie toward the country of origin. Leadership positions were likely filled by managers in the first location. Even though employees might reside around the globe, growth could be inhibited by lack of leaders in other areas.
The key to successful international business expansion is finding and training leaders in all locations. Navigate language and cultural barriers more easily with someone from the same geographic region offering input and advice.
Business is often easily conducted remotely. However, finding a time for meetings or to touch base with employees is challenging for companies with workers across time zones. While a noon meeting might work well for half the people logging on, it could be the middle of the night for someone on the other side of the world.
Options include holding more than one meeting or pre-recording a presentation and allowing participants to view it at a time convenient for them. Chat tools such as Slack or Skype might be another option. People add their thoughts and view notes in their time zone and chime in. Wrap up the meeting after 48 hours.
It’s complicated to navigate emergency situations while focusing on international business expansion across time zones. However, the majority of meetings can be turned into an email or conducted in a way that doesn’t inconvenience anyone.
Recent advances in artificial intelligence may allow businesses to automatically answer basic employee queries or conduct repetitive tasks more easily. The global AI market is $142.3 billion and growing rapidly. Pay attention to what’s trending in the home country as well as places a brand does business or has employees.
Adopt a policy to utilize different programs in different regions. Some countries may ban various software, for example, so look for what works best for the organization but also is usable for all workers. Think about what can mesh together or be separated without creating a choppy experience for employees, leaders or consumers.
Shipping items from one region to another can be complex. Take the time to research which global carriers are most reliable. Find backups as strikes or regulatory requirements might delay deliveries.
Hire an expert in dealing with supply chains across borders to come up with the best course of action.
Taking a brand from local to global requires careful navigation to avoid problem areas. Each company must determine if the effort equals the payoff in the long run. For organizations looking for a way to grow, diversification into other cultures may hold the key to international business expansion.
Eleanor Hecks is editor-in-chief at Designerly Magazine. She was the creative director at a digital marketing agency before becoming a full-time freelance designer. Eleanor lives in Philly with her husband and pup, Bear.
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