Going global is usually a worthy endeavor, but it does bring with it some challenges. If you are interested in taking your business global, it is crucial you have a plan in place to address some of the main hurdles you will need to overcome to succeed. We've outlined 8 main challenges for companies going global that will help prepare you for global expansion.
1. The Physical Distance
Although you may have the Internet and telephones to communicate overseas, nothing is quite the same as being there in person to talk to your prospects and your distribution partners, not to mention costs related to freight, logistics and shipping. At some point, you will have to figure out the costs involved in doing business “long distance” in the regions where you want to expand.
2. Unfamiliar Cultures
Do you know the most common behaviors in the country you are looking to expand into? What about the way in which people interact with each other in a social setting? Overcoming this cultural challenge is important for taking your business global so that you can assimilate with the people who will become your customers.
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3. Mastering Marketing
Are you familiar with the buying process in the country that you wish to expand into? Learning the best way to reach your prospective customers is an important element of taking your business global. This will allow you to establish the kind of customer base that is necessary to be successful with globalization in the long term. One key ingredient to successful global marketing is transcreation. Transcreation will allow you to adapt your marketing content to a new foreign market.
4. Organizational Communication
The way team members handling your globalization efforts communicate, report, and track their efforts will have a big impact on how well you can succeed at taking your business into foreign markets. You need to have an effective system and set of protocols in place so that company leadership can keep tabs on what is going on with your international expansion since they will not be there to manage in person.
5. Tariffs and Export Fees
Most countries have some type of tariff or fee that is charged to companies bringing goods into their country. You need to know about these tariffs so you can incorporate them into the financial planning element of your globalization plans. Also remember the legal side of globalization: you may have to pay different kinds of fees depending on the shipping and logistics laws in place in that specific country.
6. Human Resources
When taking your business global, it is important to consider how you will meet the manpower requirements for operating in a foreign country. You may need to hire new team members which will require an additional investment. If you decide to send some of your existing team members to new global markets, you have to account for the roles that they will leave vacant.
7. Choosing the Right Countries
You need to have done enough research to understand where the best place to expand is. If there are several options, analyze the relative benefits and drawbacks of each country to determine which markets are most ideal for globalization.
8. Properly Adapting Documents and Content to the Culture
You have to come up with a way your prospective customers can read and understand your sales materials, instructions, and other documentation that is important for your business. Ideally, you will be able to do more than just translate them; you will have them adapted to the culture so that they are optimally understood and relatable by locals.
Addressing these issues will help you meet the challenges presented by taking your business global and help you extend your company's reach to new heights.