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PDF documents: 20 factors to consider before going global
8 things to consider before going global
Market research 3.1
In the reading materials there are many different considerations to be made when
considering expanding internationally in business. Pick what you consider to be
two of the most important considerations and discuss them.
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PDF documents: What business do you want to start
International business plan outline.
Developing an international business plan.
How does developing a domestic business plan differ from that for international
business expansion? Select two major areas of difference, provide examples,
discuss and post them.
20 Factors to Consider Before Going Global
Never in the history of the world has the entrepreneurial spirit-the spirit of adventurebeen more alive or in a more favorable position to reach out to the world for business.
International trade increases sales and profits, enhances a company's prestige, creates
jobs, and offers a valuable way for business owners to level seasonal fluctuations. But
one thing gets tricky: what factors to consider or develop before going global.
As with any new business plan, the first step you should take before crossing borders is to
do your homework. Take these 20 critical factors into account before you begin:
Factor 1: Get company-wide commitment. Every employee should be a vital member
of your international team, from the executive suite to customer service through
engineering, purchasing, production and shipping. You're all in it for the long haul.
Factor 2: Define your business plan for accessing global markets. An international
business plan is important in order to define your company's present status and internal
goals and commitment, but it's also necessary if you plan to measure your results.
Factor 3: Determine how much you can afford to invest in your international
expansion efforts. Will it be based on ten percent of your domestic business profits or on
a pay-as-you-can-afford process?
Factor 4: Plan at least a two-year lead-time for world market penetration. It takes
time and patience to build a great, enduring global enterprise, so be patient and plan for
the long haul.
Factor 5: Build a website and implement your international plan sensibly. Many
companies offer affordable packages for building a website, but you must decide in what
language you'll communicate. English is unarguably the most important language in the
world, but only 28 percent of the European population can read it. That percentage is
even lower in South America and Asia. Over time, it would be best to slowly build a site
that communicates sensibly and effectively with the world.
Factor 6: Pick a product or service to take overseas. You can't be all things to all
people. Decide on something. Then stick with it.
Factor 7: Conduct market research to identify your prime target markets. You want
to find out where in the world your product will be in greatest demand. Market research
is a powerful tool for exploring and identifying the fastest-growing, most penetrable
market for your product.
Factor 8: Search out the data you need to predict how your product will sell in a
specific geographic location. Do you want to sell a few units to a customer in Australia
or ten 40-foot containers on a monthly basis to retailers in France? Doing your homework
will enable you to find out how much you'll be able to sell over a specific period of time.
Factor 9: Prepare your product for export. You should expect to adapt your product to
some degree for sale outside your domestic markets before you make your first sale.
Packaging plays a vital role in enabling international connections. Make yours the best in
its class, and you'll be able to sell it anywhere in the world.
Factor 10: Find cross-border customers. There is no business overseas for you unless
you can locate customers first.
Factor 11: Establish a direct or indirect method of export. It all boils down to export
strategy and how much control you wish to exercise over your ventures. On the other
hand, readiness to seize an opportunity is more important than having your whole
strategy nailed down beforehand.
Factor 12: Hire a good lawyer, a savvy banker, a knowledgeable accountant and a
seasoned transport specialist, each of whom specializes in international transactions.
You may feel you can't afford these professional services, but you really can't afford to
do without them.
Factor 13: Prepare pricing and determine your landed costs. Be ready to test out your
price on your customer. See what reaction you get and then negotiate from there.
Factor 14: Set up terms, conditions and other financing options.Agree on terms of
payment in advance, and never, ever sell on open account to a brand new customer. No
ifs, ands or buts. Just don't.
Factor 15: Brush up on your documentation and export licensing procedures. If you
find it too time consuming, hire a freight forwarder who can fill you in on the spot. Ask a
lot of questions. Use their expertise to your advantage.
Factor 16: Implement an extraordinary after-sales service plan. The relationship
between your company and your overseas customer shouldn't end when a sales is made.
If anything, it should be just the start of a long relationship which requires more of your
attention. The "care and feeding" of your customers will determine if they keep coming
back for more.
Factor 17: Make personal contact with your new targets, armed with culturespecific information and courtesies, professionalism and consistency. Your goal
should be to enter a different culture, adapt to it and make it your own.
Factor 18: Investigate international business travel tips. The practical aspects of
international business can make or break the success of your trip. In preparing to go
boldly where you've never gone before, plan accordingly.
Factor 19: Explore cross-border alliances and partnerships. In charting your global
strategy, consider joining forces with another company of similar size and market
presence that's located in a foreign country where you're already doing business, or would
like to. Gauge your readiness-or willingness-to take on a 50/50 partnership and what it
can and cannot do for you.
Factor 20: Enjoy the journey. Never forget that you are the most important and
valuable business asset you have, and that the human touch is even more precious in our
age of advanced technology. Take the best possible care of yourself, your employees,
your suppliers and your customers, and your future will be bright, prosperous and happy.
Going global doesn't have to be a scary proposition. By considering and developing these
twenty essential factors before going global, your organization can realize the full
potential of globalization and capture dramatic revenue growth.
8 Things to Consider Before Going Global
1. Standardization of Products
The first thing you need to consider is the quality of your products and
services. If you are planning to expand internationally, you will need to
provide the high quality of goods and services to your foreign clientele.
Furthermore, every market has its own standards of quality and
assurance that need to be met in order to cre ate a strong position for
yourself and your company. Along with the best quality of products, you
also need to be able to maintain a certain amount of consistency in your
standards of quality. The manufacturing process should be able to
produce the same high-quality goods every single time as inconsistencies
will make your reputation unreliable in a new market.
In order to ensure quality, rigorous testing of your product quality should
be conducted to ensure that you can always perform up to your mark and
live up to your name and customers’ expectations.
Adaptability and flexibility are a vital part of business operations. Every
entrepreneur needs to be open to change and adaptation when it comes
to business plans, products, and marketing stra tegies.
When you enter a new foreign market, you might face a lot of challenges
that may demand drastic changes in order to allow your business to grow.
Rigidness of a business owner can lead the company towards a sharp
decline. Hence, be open to new ideas and suggestions as every market
will have its own forms of producing and marketing goods.
You will need to adapt to the local culture and business trends and find a
balance between the aims you want to achieve and the means of
3. Language and Cultural Differences
Within local markets, expansion can be quite easily accomplished as
there are no language and/or cultural barriers to overcome. However, for
international markets, overcoming this obstacle can become very
challenging if a properly organized plan is not followed.
To make your mark in a foreign market, you and your employees need to
either learn the new language or find a representative who can guide you
and promote your business accordingly. Having adequate information
about the local market of the country where you wish to expand your
business is also necessary as cultural differences can often hinder
For instance, there are many cultures where outright and bold marketing
strategies can fail but subtle hints can work wonders for retail
businesses. Hence, if you are selling a product that is forbidden in certain
religions or culture, or if you are promoting your products in a certain
way that is not considered appropriate by the locals, they will not be
motivated to buy your goods and services.
You can only find out about these details from studying your targeted
international markets and by conversing with local representatives who
have a better grasp of the business trends prevalent in the area.
4. Market Considerations
In addition to monitoring your product quality, you also need to consider
whether the product you are trying to sell has a demand in your targeted
foreign market. There are two things that you need to discover:
Firstly, the suitability of the product in the market and its demand .
Promoting your product in a market where there is no demand for it, will
not be very profitable for your enterprise. Hence, you need to be careful
when choosing your location for global expansion.
Secondly, availability of similar products locally at cheaper rates. If a
country produces a good quality product in its local factories and is
providing it to the people at cheaper rates, they will be less likely to opt
for imported items. This means that you should analyze the pro ducts
available in your target market. Is there a local product that is similar to
the one you are offering? At what price is it being sold and what does
your product have that will make people opt for it over the local variety?
Plan your marketing strategy and set your cost of goods accordingly.
5. Dedication and Commitment
Global expansions can be tough to accomplish if you are not completely
dedicated to the task at hand. You will need to take one step at a time
and be clear about the aims you wish to achieve by exporting your
You will also need to find local employees who are as dedicated to this
cause as you are or perhaps you would prefer transferring your existing
employees to a foreign office base. Whatever your choice may be, if you
are not committed to your goal, you will have a hard time in achieving it.
6. Organizational Structure
Businesses cannot progress without proper organization and business
plans. Your global expansion needs to have a clear and comprehensive
strategy to implement. This includes finding buyers for your products,
setting up a foreign branch office, hiring of local employees and
representatives, checking the availability of raw materials if you are
planning on producing locally, etc.
As a business owner, these decisions of strategizing the expansion fall
onto your shoulders but if you require assistance, you can seek the
counsel and help of your existing employees as well as local
representatives within the new market.
7. Rules and Regulations
Every government has its own set of rules and regulations that
companies need to follow when they are importing their goods into a
foreign country. There are tax laws and legal considerations that must be
taken care of before the expansion and production process can go
Find good legal counsel in your country as well as your targeted
international markets to help you with these formalities to provide your
business with a smooth road to success.
8. Investments and Capital
Global expansion does not happen overnight, and it most certainly is not
a cheap process. Time and money are needed to take your business to the
next level across geographical borders. Thus, for an international
expansion, you need to have enough capital to be able to successfully
invest it in another country’s business market.
If you do not have an adequate amount of capital, find investors or
shareholders who can provide you with the funds you need to go through
with this expansion plan.
Ultimately, these considerations along with the right amount of time,
money, dedication and local market awareness; can give new heights to
your company as it grows on an international level with the help of your
global expansion plans.
Going global doesn’t have to be a scary proposition. By considering and
developing these twenty essential factors before going global, your
organization can realize the full potential of globalization and capture
dramatic revenue growth.
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