Never
in the history of the world has the entrepreneurial spirit—the spirit of
adventure—been more alive or in a more favorable position to reach out to
the world for business. International trade increases sales and profits,
enhances a company's prestige, creates jobs, and offers a valuable way for
business owners to level seasonal fluctuations. But one thing gets tricky:
what factors to consider or develop before going global.
As
with any new business plan, the first step you should take before crossing
borders is to do your homework. Take these 20 critical factors into account
before you begin:
Factor
1: Get company-wide commitment. Every employee should be a vital member
of your international team, from the executive suite to customer service
through engineering, purchasing, production and shipping. You're all in it
for the long haul.
Factor
2: Define your business plan for accessing global markets. An
international business plan is important in order to define your company's
present status and internal goals and commitment, but it's also necessary if
you plan to measure your results.
Factor
3: Determine how much you can afford to invest in your international
expansion efforts. Will it be based on ten percent of your domestic
business profits or on a pay-as-you-can-afford process?
Factor
4: Plan at least a two-year lead-time for world market penetration. It
takes time and patience to build a great, enduring global enterprise, so be
patient and plan for the long haul.
Factor
5: Build a website and implement your international plan sensibly. Many
companies offer affordable packages for building a website, but you must
decide in what language you'll communicate. English is unarguably the most
important language in the world, but only 28 percent of the European
population can read it. That percentage is even lower in South America and
Asia. Over time, it would be best to slowly build a site that communicates
sensibly and effectively with the world.
Factor
6: Pick a product or service to take overseas. You can't be all things
to all people. Decide on something. Then stick with it.
Factor
7: Conduct market research to identify your prime target markets. You
want to find out where in the world your product will be in greatest demand.
Market research is a powerful tool for exploring and identifying the
fastest-growing, most penetrable market for your product.
Factor
8: Search out the data you need to predict how your product will sell in a
specific geographic location. Do you want to sell a few units to a
customer in Australia or ten 40-foot containers on a monthly basis to
retailers in France? Doing your homework will enable you to find out how
much you'll be able to sell over a specific period of time.
Factor
9: Prepare your product for export. You should expect to adapt your
product to some degree for sale outside your domestic markets before you
make your first sale. Packaging plays a vital role in enabling international
connections. Make yours the best in its class, and you'll be able to sell it
anywhere in the world.
Factor
10: Find cross-border customers. There is no business overseas for you
unless you can locate customers first.
Factor
11: Establish a direct or indirect method of export. It all boils down
to export strategy and how much control you wish to exercise over your
ventures. On the other hand, readiness to seize an opportunity is more
important than having your whole strategy nailed down beforehand.
Factor
12: Hire a good lawyer, a savvy banker, a knowledgeable accountant and a
seasoned transport specialist, each of whom specializes in international
transactions. You may feel you can't afford these professional services, but
you really can't afford to do without them.
Factor
13: Prepare pricing and determine your landed costs. Be ready to test
out your price on your customer. See what reaction you get and then
negotiate from there.
Factor
14: Set up terms, conditions and other financing options. Agree on terms
of payment in advance, and never, ever sell on open account to a brand new
customer. No ifs, ands or buts. Just don't.
Factor
15: Brush up on your documentation and export licensing procedures. If
you find it too time consuming, hire a freight forwarder who can fill you in
on the spot. Ask a lot of questions. Use their expertise to your advantage.
Factor
16: Implement an extraordinary after-sales service plan. The
relationship between your company and your overseas customer shouldn't end
when a sales is made. If anything, it should be just the start of a long
relationship which requires more of your attention. The "care and
feeding" of your customers will determine if they keep coming back for
more.
Factor
17: Make personal contact with your new targets, armed with culture-specific
information and courtesies, professionalism and consistency. Your goal
should be to enter a different culture, adapt to it and make it your own.
Factor
18: Investigate international business travel tips. The practical
aspects of international business can make or break the success of your
trip. In preparing to go boldly where you've never gone before, plan
accordingly.
Factor
19: Explore cross-border alliances and partnerships. In charting your
global strategy, consider joining forces with another company of similar
size and market presence that's located in a foreign country where you're
already doing business, or would like to. Gauge your readiness—or
willingness—to take on a 50/50 partnership and what it can and cannot do
for you.
Factor
20: Enjoy the journey. Never forget that you are the most important and
valuable business asset you have, and that the human touch is even more
precious in our age of advanced technology. Take the best possible care of
yourself, your employees, your suppliers and your customers, and your future
will be bright, prosperous and happy.
Going
global doesn't have to be a scary proposition. By considering and developing
these twenty essential factors before going global, your organization can
realize the full potential of globalization and capture dramatic revenue
growth.
