How to Expand Your Business to Other Countries

7 Steps to Expand Your Business Internationally

Over 50% of businesses say the UK’s economic challenges have made international trade more important. More than double the number from 3 years ago.

But you have to be strategic to see international success. So, here are seven key steps to help you get started.

1. Understand Market Dynamics

Market dynamics drive pricing, demand, competition, and people’s behaviour in a given market. 

So, if you want to expand business internationally and crush it, you’ve got to consider these five key elements:

• Economic conditions: These influence product demand, pricing strategies, and profitability. Key factors include GDP, inflation rates, and purchasing power. A growing GDP signals more potential customers, while low inflation and strong purchasing power support premium products. 

Data from the World Bank, national agencies, and firms like Statista and Euromonitor can help you in this research. The Rapyd blog also offers the latest payment trends and reports. These reports give you insights into how you can shape and refine your business extension strategy.

• Regulatory and political factors: To ensure compliance and risk management, research import/export restrictions, tariffs, tax systems, labour laws, and trade policies that could impact your costs or operations. It’s also essential to assess the political landscape so you can gauge the risk of sudden regulatory changes, civil unrest, or instability that might disrupt your business operations.
• Cultural and social trends: Research local preferences for product features, design, and packaging. Monitor trends such as sustainability, health consciousness, and digital connectivity as they impact buying habits. Also, consider whether consumers prefer shopping online, in person, or both to guide your sales strategy and distribution channels.
• Competitive landscape: You must identify the key players and understand their products, pricing, and customer base when entering a new foreign market. Look at alternative products that meet the exact needs. What potential threats or opportunities can you spot? Also, think about barriers like startup costs or regulatory hurdles that could affect your ability to compete.
• Technological advancements: High digital adoption in local markets influences things like e-commerce, online marketing, and digital payments. Consider these technologies and see how they can enhance your business operations. Also, as you expand into new countries, you need a strong infrastructure. Tools like cloud platforms and databases, such as vector or graph databases, can help you manage increasing data loads without compromising performance. 
• Distribution channels: Some markets may prefer online shopping, while others lean toward traditional retail. You must understand these shopping habits and choose the right channel to reach your target audience effectively.

These factors are all connected, so no single thing will guarantee success in a new country. For example, a high-GDP country might have great purchasing power, but your product will still struggle if it doesn’t vibe with local values or runs into legal issues.

Pro Tip: Try a soft launch first to test demand before going all in.

2. Study Legal and Regulatory Compliance

You have to comply with the laws, regulations, and industry standards of each country. This includes tax, labour, environmental, product safety, intellectual property laws, and even regulations on using AI in payments.

Compliance with these regulatory requirements will prevent fines, legal disputes, and delays. This is essential to protecting your brand and reputation. It also helps with contracts, supply chains, and engagements with local authorities.

Familiarise yourself with the laws of your target market by consulting with legal experts and local advisors. They will point out your obligations and the best practices to follow upon entry into the market.

You should also analyse tax structures to identify opportunities for tax credits and other incentives and avoid double taxation that might affect pricing or other supply chain decisions.

Modern technology, through things like regulatory intelligence tools, can help you monitor regulatory shifts, facilitate accurate reporting, and mitigate the risks of non-compliance.

3. Consider Language Barriers and Cultural Differences 

Have you heard the famous story of how Pepsi’s “Come Alive” campaign backfired in China? The campaign was misinterpreted as “Bring your ancestors back from the dead.” 

That example perfectly highlights how cultural oversights can hurt your brand and why language isn’t just about translation. 

Miscommunication can lead to misunderstandings and customer dissatisfaction. So, you must adapt your business culture to local languages and cultural nuances.

To achieve this, try:

• Hiring local experts: Work with regional managers or consultants who know the domestic market well.
• Conducting cultural training: Train employees to be culturally sensitive and avoid missteps.
• Engaging in local networking: Partner with local business owners and attend events to learn more.
• Offering multilingual support: Provide customer service in local languages with chatbots, call centres, or native reps.
• Respecting time zones: Align support hours with local business schedules.
• Using local platforms: Use the platforms your customers prefer, like WeChat in China or WhatsApp in Brazil.

These strategies let you tweak every part of your customer experience, from marketing to products, to make sure it connects culturally.

For marketing, that means adjusting visuals, tone, and humour to fit local tastes. It also helps you select the right SEO agency that understands these nuances. They’ll know the right keywords locals use and ensure your content feels natural.

For your products and operations, it means adjusting your offerings to match local tastes. Take McDonald’s, for example. They offer rice dishes in Asia and halal menus in Muslim-majority countries. 

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Check out the example in the image above. Unlike in the US, where McDonald’s wraps are made with white bread, the Chinese version uses green bread, kind of like a veggie hand-roll with a slice of chicken.  

4. Create Your Business Plan and Secure Financing

Before expanding, you must create a comprehensive international business expansion strategy. The strategy will guide you through each stage of starting, managing, and growing your business. 

Your business plan should include the following:

• Executive summary: A concise overview of the business model, its objectives, and the vision for expansion.
• Business description: Detailed information on the company, its mission, products/services, and competitive advantage.
• Market analysis: Research into the target market, customer demographics, industry trends, competition, and market size and opportunities in international regions.
• Marketing strategy: A plan for positioning the product or service in new markets, including promotional tactics, sales strategies, and local market adaptations.
• Operational plan: Details on how the business will operate in the new market, including supply chain, production, distribution, and staffing.
• Financial plan: Projections of revenue, expenses, and profitability, alongside funding requirements and potential sources of financing, e.g., banks, investors, and grants.
• Risk management plan: Identify potential risks associated with international expansion, such as political instability, currency fluctuations, economic downturns, and regulatory challenges, along with strategies for mitigating them.
• Contingency plan: An exit strategy or backup plan in case the international expansion strategy doesn’t go as expected. It helps you manage any surprises along the way.

Create a detailed business plan covering each of these key areas. The more detailed and data-informed the plan, the higher your chances of success. Also, a good business plan makes it easier to attract the right investors and make sure your business grows and thrives across borders.

5. Build Your Team

To go global, you need a team that gets the ins and outs of each region you’re targeting. 

Local talent will help you understand customer preferences, regulations, and market trends. They can also break down language barriers, build relationships, and help your business move faster.

But don’t forget to have a solid in-house team that knows international business practices, marketing, finance, and logistics. They’ll keep your brand consistent and make sure everything runs smoothly across regions.

Also, team up with local distributors, suppliers, and legal experts. They’ll help you navigate rules, connect with local networks, and spot opportunities or challenges.

Finally, prioritise diversity in your hiring. A mix of backgrounds means fresh ideas and distinct perspectives. Make sure your hiring process is inclusive and offers flexible, remote work options to access a broader talent pool.

6. Build Your Brand

You’re just another foreign brand if you don’t localise your business. 

Customers notice when you get their humour, culture, and needs. So, take the time to adjust your messaging, tone, and visuals to what local audiences love. And remember that what works in one place might not work in another.

Adjust your brand’s voice to feel authentic to each audience. This applies to how you approach sales prospecting calls and customer service. Even small things, like scheduling calls in the local date format, i.e., DD/MM vs. MM/DD, can make a big difference.

You might also need to tweak your products or services to suit local needs. This could mean changing features, packaging, or adding new variations that appeal to local tastes.

Take Starbucks, for example. They changed their menu to fit Japanese tastes. They offer exclusive drinks like Yuzu Citrus Tea and desserts like Mocchiri Balls.

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That said, you must maintain your brand’s core identity. Your logo, colours, and mission should remain consistent across markets. But elements like language and imagery can be localised to reflect the unique culture of each market.

7. Adhere to the Payment Culture

Different markets have different payment preferences. 

In some places, people love using credit and debit cards, while in others, mobile payments, bank transfers, or cash on delivery are more common. Do your research to find out what payment methods locals trust and offer those options.

Also, make sure your pricing matches what people are used to seeing, including format, currency and payment methods. And, don’t forget to check that your payment systems follow local tax rules and regulations.

Get the Keys to Successful International Business Expansion

To expand business internationally, start by getting a solid grasp on market dynamics. Then, follow the local laws and respect cultural differences. 

You’ll also need a strong business plan, an awesome team, and a brand that connects with people. Don’t forget to stay on top of local payment preferences to ensure smooth transactions and a pleasant customer experience.

Control these areas, and you’ll open new opportunities, reduce risks, and set yourself up for long-term success.

About the Author:
David Pagotto is the Founder and Managing Director of SIXGUN, a digital marketing agency based in Melbourne.