How to Internationalize Your Business
Internationalising a business is a large undertaking, but when you approach it methodically and thoughtfully, it can be extremely rewarding and profitable. Let’s take a look at the steps toward internationalising a business.
Using reliable and accurate metrics, evaluate the market attractiveness of each country under consideration. Look for the best fit for your particular products and services.
Tools like Porter’s Five Forces and the classic SWOT analysis can be very helpful in determining the advantages and disadvantages of setting up business in specific countries. As you analyse your options, pay special attention to the external environment, since this will be the largest departure from your current operations.
Will your current business model work well in the new country? In order to successfully enter the new market, you may want to consider acquiring a local business to capture their core business expertise, accessing local knowledge or making a strategic alliance with an existing business.
You’re very familiar with your position in your current market, but you’ll need to consider your positioning in international markets as well. Evaluate the competition and their positioning to help you find your own place.
Due to differences in consumer taste, lifestyle, and spending, you may need to target international customers. Take a close look at geographical, demographic, psychographic, and behavioural data as you determine your target customer base.
Do your current products and services meet the needs of consumers in your target countries? Many businesses find that they need to adapt their products to suit the needs and desires of their international customers.
With the information you’ve gathered about your market position, target customers, and products and services, you’re in a good position to evaluate your core competencies. Do you currently have access to the skills and resources you need to successfully position your business internationally? If not, do you know how to acquire those core competencies?
Internationalising a business requires attention to importing/exporting, franchising, regulations, and licensing. Do you have systems in place to manage all elements of your supply chain?