In the past, only massive enterprises with a seemingly endless pool of resources expanded globally. The investment and infrastructure required to do business in other countries were well beyond the reach of small businesses. Today, you have a far different playing field. Technology makes it possible for a one-person operation to sell products and services all over the world. The globalization of the economy provides many opportunities abroad, whether you want to market in new regions or move your headquarters there.
Why Your Small Business Should Go Global
While cloud-based technology and extensive internet connectivity make it much easier to take your business global, you still need compelling reasons to go this route.
One of the biggest motivations to consider other countries is the chance to reach other audiences. Many products and services have widespread appeal, and there are only so many people in your home country to make purchases. When you look at other regions, you have an almost unlimited opportunity to expand your audience.
Many of the barriers to entry are gone, especially if you only want to sell overseas. International shippers handle millions of packages from e-commerce businesses, so the infrastructure is in place when you’re ready to expand.
Depending on your industry and current location, you also have the opportunity to get tax benefits. Many countries have incentives in place to encourage more businesses to move into their regions, which can drastically reduce your overall expenses at tax time. The cost of labor may be cheaper, while still maintaining the quality your customers expect.
An international business comes across as a more trustworthy entity. If you can say that you have offices around the world, you’re giving the impression of a highly successful and well-established organization. You may only have a token presence outside of your headquarters, but that’s still enough to earn you this benefit.
Are your products saturated in your home market, or is there too much competition? Other countries may be prime locations to be the first to market. You build the demand and have a strong hold on this product line long before any other organizations make their way to this place. Even if you’re doing well right now, diversifying the places you do business can smooth out your cash flow and reduce the chance of company-wide losses.
How to Expand Internationally as a Small Business
You have a significant amount of planning to do when you grow your company into other countries, even if you aren’t establishing a physical location in the region. Before you do anything else, you have to confirm that there’s a market for your products. Otherwise, you put a lot of time, effort and resources into something that’s guaranteed to fail.
Market research is necessary to make sure there’s enough interest to be profitable. If you don’t find competitors already operating in the region, make sure you have a good product-fit for your audience’s needs. In some cases, your existing catalog fits perfectly in with consumer expectations. You find this happens most often when you’re going to a country with a culture or economic level similar to your own. Be prepared to develop new products and services that better serve your customers in these locations. Look at the way they use similar items and how your offerings fit into their daily lives.
Your next step is going over all the legal issues that can get in the way of international business. What are the requirements to buy or sell in that country? Do you need local employees to become eligible to do trade in that area? What are the city-specific requirements you could be contending with?
On the logistics front, payment processing is another challenging area. Some regions rely on local options to handle credit cards, while other countries happily accept the same types you already take.
Global tax codes are also tricky, especially if you’re based in the United States. You need to understand how your revenue splits between these areas, whether you owe U.S. taxes even if you’re operating overseas, and other financial matters. Look for accountants specializing in international business, as they have the best knowledge of this situation.
Local connections give you an excellent insight into your target overseas markets and the cultural concerns you need to address. They also give you networking opportunities with local suppliers and other businesses that can help you become successful.
Consumers all around the world turn to the internet to find out more information about your company, so translation is a must. While auto-translation tools exist, they harm the trust that you need to build in new markets. Once you get your site translated, you should also go one step further and get it localized. Localization is the difference between a technically correct translation and one that incorporates local slang.
Audit your current technology infrastructure, and make sure that it can scale for a global audience. You may need to bring in new technology that is better suited for this use case.
A small business loan gives you the capital to start your international expansion and accommodate unexpected costs. You don’t have to be a huge company to take advantage of the global marketplace. Put your plan together, and prepare to become a worldwide organization.
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