Over my career I’ve researched, set up, managed and even sold on companies in 15 countries, and I’ve travelled for business or pleasure to nearly 140. So, unsurprisingly, business people that I meet always ask why, where and how to get started with exporting or international expansion of their own. Now, as host of the Grow through International Expansion podcast and media platform, calls come in every week.
Of course, there’s no “one size fits all” answer – everything depends on you and your business. But, getting started, there are some pretty safe generalisations.
Location, Location, Location!
That would probably be the best title for this article, but a TV programme got there first! But whether you’re buying a house that you’ll be happy to live in for the rest of your life, or looking for an overseas market where your business can successfully grow, location is critical. All my 5 “Top Tips” relate to location.
1. Be guided by your wallet, not your heart
However altruistic you may like to be thought, the reason you’re in business is to make money. You need to pick your location – your first export market or overseas base – based primarily on what is going to generate the best returns soonest. Start small, learn the ropes, discover the pitfalls, and achieve some early success in international business before aiming to conquer the world.
Obvious, isn’t it? But you’d be surprised how many business people pick their first overseas location either because it seems easiest (USA or Australia, anyone?), or because they went there on holiday and saw some substandard competition there, or (in at least 5 cases I can remember) simply because they or their partner has family there.
More importantly, you have to consider things like the strength of local competition, what regulations and duties you’ll be hit with, and, fundamentally, the cost of launching into that market and how quickly you can expect to get a return on that investment.
2. But fall in love with your chosen market
So you need to pick a location that’s likely to deliver quick and attractive returns and encourage you to take your business even further afield. Nevertheless, there’s no point in deciding on somewhere that you’ll dislike. Your first location has got to be somewhere you and your staff can get to easily and affordably, and that you’re likely to enjoy going back to time and time again. It also needs to be a country where you get a good “gut feel” about the people – a cultural approach that’s compatible with yours, and a sense of trustworthiness.
3. Take Independent Advice
Whichever country you choose as your first export market or base to set up an overseas operation, do research online and talk to others first. And don’t just talk, listen! In detail. There’s a lot of government bodies, professionals and consultants offering advice, some free, some paid for. Obviously there’s no harm in talking to anyone, but before taking them too seriously – and always before paying for advice – check out their basic credentials:
- What is their practical experience of international business?
- Have they actually managed or worked closely with a business in a similar sector to yours?
- Have they actually set up or managed an overseas business in the country you’re considering?
- Do they have useful contacts in your chosen country?
- Are they truly independent? No bias towards one country or another? Not surreptitiously out to sell you professional services from some other organisation?
- Will they commit to working with you – not only on the phone, but on the ground – over the long term?
4. Don’t delegate too soon
International expansion – whether it’s just exporting or establishing overseas bases – is a critical and strategic move for your business, and potentially the most valuable initiative you’ll ever undertake. Unless your business is big enough to support a dedicated full time Chief International Expansion Officer, make sure that you and others who have “skin in the game” are fully involved – not only in planning but in execution and at least the first year’s operations. Simply designating one of your sales people as Export Manager doesn’t cut it (though you’ll need to do that too). Make the time. It’s worth it.
5. Hire good local people
There are those who’ll have you believe that all you need is a good local agent. Well, that could get you started with exports – but very few find a happy long term international future that way. Sooner or later – and I’d say sooner – you’ll need your own local in-country operation to get maximum value and sustainability, even if you’re just exporting goods or services. I always recommend looking for a potential local country manager right from the very start – even if you then decide not to hire straight away, in the process you’ll learn a lot about the country, its business culture and market opportunities.
There’s a lot of other things to consider, of course, but remember these five points and you won’t go far wrong. If so far you’ve only sold in one country, you don’t know what you and your business are missing. There’s a big world out there – and it’s easier and costs less than you think to expand.
Oliver Dowson is a widely-acknowledged specialist in international business expansion. He has set up, managed, and even sold on companies of his own and for others in 15 countries, and has visited and done business in nearly 140. He’s now the Host of the Grow through International Expansion podcasts, an independent and not-for-profit platform covering an ever-growing range of topics relevant to those active in or planning international business. Find all the content at https://growinternational.org and subscribe (free) to Oliver’s podcasts – listened to by thousands every week – on your regular podcast channel (Apple, Google, Spotify and most others). Oliver welcomes your questions and comments emailed to [email protected] or via LinkedIn https://www.linkedin.com/in/oliverdowson1/