Has your business flourished across the region and now feel it’s time to expand it overseas?
While international commerce might sound easy, it’s a challenging step that requires careful planning and lots of due diligence.
Before expanding your successful business overseas, there are several factors that you must consider.
Here are nine steps that every business planning to expand to international markets should take:
1. Develop a Sound Strategy
Before embarking on this journey, there should be some plan, however loose it may be. Even if you don’t know where you will end up, you can recognize what direction you need to go.
With international trade, there are a few things you’ll need. This includes business license, tax ID number, and export or import licenses.
You don’t want to get all the way through importing before realizing that you don’t have everything you need.
This could cause delays in your shipment or even make it ineligible to import, depending on where they come from.
2. Identify Your Customers
The first step in the importing process is to determine if there’s enough market for your product overseas. Who are your target customers or market?
Once you have determined who will buy your product, it becomes easier to pinpoint where they might reside. You should also understand that certain products work better than others for exports.
For example, luxury items like Rolex watches sell well for export because people overseas look at them as status symbols rather than everyday commodities.
If you’re unsure whether international trade is suitable for your company, discuss it with an expert.
You can seek guidance from global business consultants who specialize in this kind of work at a minimal cost.
3. Examine the Culture of Your Customer’s Home Country
Different cultures have different ways of doing things, so you mustn’t offend anyone when entering a new market. There are many examples of this, including language, idiomatic expressions, and even gestures.
Equipped with the idea of where to sell your product, it’s time to examine what they want. Each country has its own set of values and ideals, as well as different consumers.
You’ll need to explore those factors before you can effectively sell there.
In some places, they have excellent quality control. Thus, if something isn’t up to par with their standards, they’ll return it without hesitation. Yet, in other cultures, people understand product defects even if it affects the usability a bit.
If you’re selling something completely legal in your home country, it doesn’t mean it’ll be in another. Use proper precautions.
Know your customers’ value system and plan your marketing accordingly.
4. Are Your Products Cheaper or Unique?
When it comes to cross-border commerce, you can’t compete with the local suppliers in pricing. However, if you can offer better quality, design, or added value items, you can corner the market in certain countries.
For instance, let’s say another company offers watches like yours, but they don’t contain jewels. If for some reason having jewels in your watch makes them more valuable, that could be what sells your product over others.
5. Know Your Shipping Options
There are many ways to get stuff from one country to another. Yet, they all come with their disadvantages and advantages.
Shipping by plane is usually costly, but it takes no time at all. However, shipping by boat will take weeks, sometimes even months, if you’re dealing with a slow boat.
Find an international shipping broker that offers you both options and can work best for your needs. Don’t just go for whichever seems quickest because price or time often overlap.
There are different tariffs and duties on exports than on imports. Thus, your costs of doing business overseas could skyrocket if you’re not careful.
There may also be legal restrictions on what you can transport out of the country and into another; for example, items containing trademarked or patented material might get stopped at customs before they even make it off of American soil.
6. Protect Your Trademarks
Not every country out there is going to have a trademark office or system in place. If the country you’re exporting to has one, you must protect yourself by registering your mark with them.
The process may vary from country to country. This step is best left up to an international trade consultant who specializes in trademarks.
7. Make Sure Your Product Complies
There are numerous laws and regulations when dealing with specific products and countries. Before you start selling internationally, make sure everything about your product complies with all legal guidelines.
This includes health and safety standards.
An import or export compliance specialist can help guide you through this process. They’ll also make sure that you’re doing everything by the book.
8. Assemble a Team to Run Your International Business
If you decide to expand abroad, then you’ll need a capable team at home to take care of things while you’re gone. Not just an extra pair of hands, but someone good at managing businesses.
Remember, it could be difficult for them to determine what is going on with the business if no employees are available.
You might need someone who can interact directly with customers or even suppliers. Therefore, pick people who are skilled in public relations to sell products indirectly through marketing methods.
Lastly, please keep track of whatever decisions or business plans they make so you don’t have to worry about it.
9. Know About Different Legal Systems
If you’re going to trade with companies in different parts of the world, you must understand their legal systems. You don’t want to assume that everything will work out because there’s a contract involved.
Also, find out whether your prospective countries allow ecommerce business if that’s what you deal with.
Many countries outside of the United States cannot take contracts too seriously. You might find yourself at risk for lawsuits if your company does business overseas and agreements aren’t honored properly.
Don’t make assumptions about local courts and understand the legal systems in place.
International Commerce Is Extremely Exciting
While it does take a lot of effort and some difficulties involved, it’s worth putting in the effort.
It can open up a whole new market where none existed before or give you access to exotic goods that otherwise would be too expensive for you to afford.
If your target country is one with a bigger economy, then you’re more likely to make higher profits. Their buying power will be much greater than others. To learn more about international commerce, bookmark our blog.