The Fourth Industrial Revolution is well underway.
Also known as Industry 4.0, this new chapter of unprecedented human development represents a convergence of technology across the physical, biological, and digital spheres.
Professor Klaus Schwab, Executive Chairperson and Founder of the World Economic Forum, and author of The Fourth Industrial Revolution, said back in 2016:
“We are witnessing profound shifts across all industries, marked by the emergence of new business models, the disruption of incumbents, and the reshaping of production, consumption, transportation, and delivery systems.”
A 2019 Deloitte paper surveyed public sector leaders with a minimum budget of $1 billion and over 2,000 global senior executives with a minimum business revenue of $500 million.
It showed that 70% of C-suite execs believe the integration of Industry 4.0 technology is necessary for long-term business success.
But the ever-evolving technological landscape is just one overarching factor to consider when you’re figuring out how to expand your business into new regions.
Read on for five fundamental aspects of international expansion that successful business leaders probably don’t want you to know.
How To Expand Your Business: The 5 Fundamentals
“Short-Termism” is a Slippery Slope
Your campaign to expand internationally starts with a step-by-step strategic business plan including in-depth analyses of:
- Currency fluctuations
- Financing requirements
- Regulatory and tax considerations
- Technological systems implementation
- Expansion, marketing, and operational costs
- Your competition and intended target market
- Cultural, legal, social, and economic differences
- Import, export, and distribution methods and expenses
Assess your scalability and readiness while setting achievable goals, but don’t get caught up in short-term gains at the expense of long-term growth.
Establishing a successful business in a foreign market requires a balancing act of expertise, swift fulfillment of market demands, and long-term sustainability.
Ad-hoc approaches often omit the risks and a counteractive Plan B and lead to miscommunications, a disjointed team, and implementation challenges.
A carefully analyzed, detailed, and holistic global expansion strategy allows for flexibility and the agility to enter new markets with minimized disruption for long-term success.
Never-Ending Research is a Top Priority
Determining how to expand your business internationally requires extensive, ongoing research to:
- Appreciate the cultural differences shaping your target market
- Confirm the political and economic stability of your chosen region
- Evaluate pricing, packaging, shipping, and payment terms for your products/services
- Develop comprehensive, customized, and adaptable marketing strategies
- Accommodate and satisfy the ever-changing needs of a foreign market
- Understand your competition, what works, why, and how you can do it better
- Assess which technological systems are most integral and beneficial for business
- Comply with tax regulations, recruitment laws, and business practices
- Evaluate local logistical, energy, and financial services
- Factor in currency exchange rate expenses and variability
- Investigate any viable funding opportunities and tax incentives
- Find distributors, international business partners, alliances, and suppliers
Research never ends, especially since the goalposts are forever shifting.
Successful international expansion strategies emphasize the importance of ongoing research in its various forms for sustainable business growth.
AI-powered analytics tools and Client Relationship Management (CRM) software are incredibly useful on the customer-centric side of things.
But you need local boots on the ground for insights into how your target market operates.
You can’t expect to enter a foreign market successfully or sustainably without any location-specific marketing expertise.
Similarly, professionals with the technical know-how on existing and future regulatory obligations, tax duties and optimization, and business immigration are essential.
For instance, a July 2021 white paper published by the World Economic Forum states that several countries have proposed and implemented a digital services tax (DST).
DST comes in after 130 countries reached a consensus for the implementation of international tax reform by 2023 per the OECD/G20 Inclusive Framework.
Without an expert to guide you through such regulatory changes to remain compliant, your international expansion strategy and business operations could come to a screeching halt.
Expansion for the Sake of Expansion isn’t Enough
Chasing after the dream of untapped markets and global domination is naive.
There, we said it.
All too often, companies big or small brazenly assume a foreign market is just as profitable as a local one—which only sends them packing back home with their tail between their legs.
(Remember Starbucks in Australia, Walmart in Germany, or Home Depot in China?)
When deciding how to expand your business globally, you need a tailor-made strategy to enhance your products or services for the foreign market.
That said, there’s no “one-size-fits-all” approach, so even if you can’t entirely align your products, the bottom line is this:
Validate any significant investment by forensic assessment or even via a controlled experiment to ensure there’s a substantial need for your product or service.
Obtain the know-how of local business and marketing experts to get valuable, genuine data.
Opportunities Exist—More Than You Realize
When expanding internationally into new target markets, you could take various approaches, such as:
- Partnering with local businesses
- Acquiring a new business in your chosen region
- Franchising your company
- Teaming up with a distribution partner
Of course, having a well-connected global team is the very first step to turning opportunities into revenue-generating realities.
Financing is another core aspect of your global expansion strategy.
Take full advantage of government grants with the help of professionals who can sift through the options and find any viable opportunities.
An Expert Global Team Makes All the Difference
Deciding how to expand your business abroad comes with countless considerations, from long-term strategic planning and ongoing research to hands-on assessment and funding.
The value of having an expert global team on your side can’t be understated.
At Innovation Park, we have 26 years of extensive knowledge of foreign markets, business immigration, development, and expansion, international corporate tax planning, marketing, and more.
We provide ambitious business leaders like you:
- Hands-on end-to-end solutions including everything from visa applications and a customized global expansion strategy to tax optimization and business management
- Access to our multinational network of progressive thinkers and innovative partners
- Freed up time, money, and resources while we take care of the nitty-gritty details
Book a paid consultation with us today, and let’s take your business to new heights.
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Sources: World Economic Forum, Deloitte, WE Forum White Paper