Are you planning to expand your business globally? Start adopting the right strategies like the leading countries for business growth.
Different factors affect the ease of business expansion. A business may struggle with a particular challenge, while another may find it a breeze to conquer it. It’s in these cases where expansion strategies will make a difference.
Continue reading below for seven business expansion strategies to consider before going global.
1. The Right Entry Strategy
The foundation of global business expansion is using the most effective entry strategy. You have four options: exporting, licensing, franchising, and Greenfield investments.
Exporting involves a third-party distributor as a partner. They will do a direct or indirect distribution of your goods. Exporting also opens doors to different markets, though hiring in-country resources is necessary.
Meanwhile, licensing involves transferring intellectual property and rights from one business to another. You will connect with a local partner for creating and distributing your products.
Franchising is perfect for bringing your brand materials and business process. In franchising, you will hire locals for labor. You will also teach them how to operate your business model. In franchising a business you can use templates for project proposals so you can easily propose the scope of your project.
Last but not least is Greenfield investment. It is a type of foreign direct investment (FDI) that features a parent company (you) building a subsidiary in another country. The approach to establishing the subsidiary is from the ground up.
Instead of outsourcing, you will re-start your company as if building it from scratch. It involves greater capital outlay and long-term commitment among stakeholders.
With this strategy, you’ll have complete control of the business. You’ll also enjoy incentives and tax breaks.
Regardless of the entry strategy you choose, always take a lean approach. Avoid buying infrastructure until your expansion becomes viable. Ask for feedback from your local employees for evaluating opportunities and improving strategies.
2. Use a Global Employment Organization
Since you don’t know a lot about the country, hiring a global employment firm is the answer. They are a group of professionals who can help you with the local business regulations. They also have resources for recruiting qualified people for your local team.
Understanding the local market is tough, especially in cultural and consumer behavior aspects. You will face issues like:
- Understanding the currency
- Taxing laws
- Human resource legislation
Some businesses have problems complying with local laws and regulations. Others choose to ignore these laws. The consequences of ignoring them include legal actions, large fines, and decreased productivity.
You can manage these risks by getting the right people by hiring a global employment firm.
3. Push Further on Digital Transformation
Adopt a strategy that focuses on your company’s digital transformation. Be sure to transition to the cloud as you expand your company. The global cloud computing market will grow by $947.3 billion in 2026.
Businesses use cloud platforms in their daily operations with the work at home setup. Connecting with your target audience and prospective partners becomes simpler through the cloud.
Invest in virtual communication solutions, especially if you have over ten employees. Install hybrid working to maximize your labor regardless of your location.
Though brick-and-mortar is still viable, it’ll take longer to expand without online engagement.
4. Adapt to Social Media Trends
As social media influences consumer behavior, adjust to the latest social media practices. Traditional posts that work two years ago may no longer be effective next year. A good example is the case of social media influencers.
A few years ago, companies weren’t serious about influencers. To their surprise, the number of social media influencers kept growing.
YouTube stars connected with consumers better than traditional celebrities. Subscribers claim to trust YouTube video creators more than their friends when purchasing.
Boost your presence across different social media platforms. Create a Facebook and Instagram account that will support your website. Make sure to link your social media accounts back to your site to create more traffic.
5. Use Trade Agencies
Connect with different trade agencies if you came from established international markets. These are government bodies that can guide you with your expansion.
Their services come free most of the time. If ever they charge, the cost will be minimal. Expect them to help you out even if you have a small budget.
The downside to relying on trade agencies is the competition. Since their help comes for free, expect many companies to line up for it. If you’re patient, the cost of waiting is worth the guidance, network, and connections they offer.
6. Focus on Translation and Localization
To create an immediate impact, prepare your website for localization and translation. Consumers trust more the products they understand compared to those they don’t.
Revisit your site’s coding and program it to handle many languages. Improve the navigation and orientations depending on your target audience.
Partner with local nationals who can help you with the proper translations. It’s not enough to change the words to their local translations. Instead, focus on making the words feel local through imagery and colloquial references.
7. Be Proactive and Reinvest in Your Business
Last but not least, take on a proactive approach to things. Develop a long-term strategy that will help you prepare for the changes in your business. Your plan should include the unique challenges and how to address them.
Reinvest in your business through your global revenue gains. Put some of your profits in the market before expanding to other countries.
As your earnings increase, your cash flow frees up. With this, you can have more funds to finance your global expansion.
Go Beyond Business Expansion Strategies
By following these strategies, global business expansion becomes easier. You’ll be effective in finding the right people to help you and connect with your target audience. However, knowing how to expand your business globally is only one way of growing your brand.
Learn about business management and other helpful tips through our different articles.