Whether you’re just starting out on your own or you’re an established brand looking to reach the next level, growth is the target. As you expand, you might consider moving into different countries and markets to reach new customers.
If you do have plans to expand into a new market, then here are the benefits to consider, potential challenges and a few tips.
Why should you enter a new market?
No two businesses are the same but a common reason that many organisations start to think about growth of this kind is because they’ve reached a natural plateau. Once you’re established within your industry and you’ve built a loyal customer base, it’s only normal to think about the next steps.
Entering a new market is easier said than done but if there is a demand for your product or service then it’s something worth considering. The more customers you have, the more revenue streams you have access to and the more you’ll continue to grow.
The benefits if you get it right
An obvious benefit but if you can enter and conquer a new market, then you’ll see significantly increased financial performance. Expansion does come with its own set of costs, but many businesses have shown that a successful expansion can lead to a huge increase in revenue.
2. Global talent
When establishing a presence in a new market, you might look to establish a local entity and hire new talent. It’s always useful to have employees on your team who know the market intimately and can offer bespoke advice and guidance to give you the best chance of success.
3. Diversification of your assets
Expansion can take place for a few different reasons. One might be because you identify an opportunity to diversify your assets and protect the business from market fluctuations. Basically, if you have multiple locations, then struggles in one market can be offset by success in another.
4. Getting the edge over your competition
By entering new markets, particularly ones that are emerging, you can get a head start on your business rivals. If they don’t already operate in a specific country, you have the advantage and a chance to establish yourselves as industry leaders.
Potential roadblocks to keep in mind
1. Cultural differences
It can take years to fully understand your home target audience. Understanding a completely new market is a challenge and what’s worked at home might fail elsewhere. Even neighbouring markets can differ wildly and it’s up to you to carry out extensive demographic and audience research beforehand.
2. Payment issues
Customers expect a smooth checkout experience, using their preferred payment method, so that it’s as easy as possible to make a purchase. Any frustrations or issues and it’s easy enough for them to just take their custom elsewhere. You’ll need to consider the payment methods you make available to customers in addition to the language, currency etc.
3. Region by region changes
We’ve already mentioned that neighbouring markets can have completely different rules and regulations when it comes to international business. The same can often be true of regions within a particular country. Large countries like the USA, China, India and Brazil might have slightly different laws from one area to the next and it’s up to you to keep track of them all.
4. Communication difficulties
Putting the obvious potential for language barriers aside, there are several communication challenges that you’ll need to consider when entering a new market. Different time zones can take some getting used to.
Not just the potential of accidentally waking a colleague at 4am but also when it comes to when a business day ends. If a supplier or company you’re collaborating with expects something on a certain day, then don’t let the time difference catch you out.
Consider the communication channels your business currently uses and how that might be impacted by establishing a local presence in Germany, for example. Is it possible to use the same channels? What do you need to do to ensure that nothing slips through the cracks because different platforms are in use?
Something that often isn’t considered is brand perception within a new market. Consumers around the world are often more confident buying from a business if they believe that it’s local. If you have a website or phone number that isn’t specific to that market, then there may be some hesitancy that can hinder growth.
To see how you can create an international number for your business, head over to our page now for more information.
Alternatively, if you’re looking for inspiration on which countries might be suitable for your expansion, then view our Connected Countries guide. It’s filled with useful data including which countries are known for having cheap and reliable internet connections.