Many business owners dream of taking their business overseas. However, expanding your company internationally may sound simpler than it is. There are numerous factors to consider, from attracting international customers to complying with local laws and regulations.
Here is how to do business in foreign countries.
Written by Eve Anderson, a travel blogger
Hire a Market Research Firm
When considering which market to enter, you should hire a trustworthy market research agency.
With a market research firm, you will understand how your brand will be received in that area. Most importantly, you will know whether there is a market need for your products and services.
A market research company will also help you adapt your brand to local customers’ needs and expectations. Most importantly, they will perform competitive research and help you explore your current market needs. That is how you will make more strategic decisions and gain a competitive advantage in a foreign market.
Address Language and Cultural Issues
Language and cultural barriers are common problems business owners face when expanding internationally. We have all heard about the major global branding failures.
One such example is Dolce & Gabbana’s recent marketing disaster. In an ad for the Chinese market, a Chinese woman tried to eat Italian food with chopsticks, while a male voice gave her directions. The marketing campaign caused Chinese customers’ frustration for a logical reason. When creating marketing campaigns for a foreign market, localize it and make sure it is culturally appropriate.
Another example is Electrolux. Their ad campaign for the U.S. market boasted that “Nothing sucks like an Electrolux,” aiming to emphasize the product’s high power. However, the ad gained a whole new meaning since its creators did not consider the slang meaning in English.
Therefore, to localize your international ads, consider hiring local marketing campaigns. They understand their country’s culture, background, and perspective better than you. That way, they can translate and create ad campaigns that make sense for local audiences.
Optimize Organizational Processes
When expanding your business internationally, you need to make sure that your entire organizational structure runs smoothly. Here, the one-size-fits-all mindset does not cut it. Cultural differences, local regulations, and employee behaviors directly impact your organizational readiness.
Once you determine how you will execute your strategy, develop processes, policies, and procedures that comply with local laws. On the other hand, make sure they align with your overall company policies.
Here are several factors to consider:
- Ask yourself whether you have a management team that can deliver a consistent company strategy.
- Determine which business decisions can be made on a local level and which need to be handled centrally.
- Invest in the right IT infrastructure and ensure seamless collaboration, irrespective of employees’ locations.
- Take care of key business operations, such as investing in small business health insurance, human resource functions, or payroll management.
- Optimize benefits programs and compensation packages. Always make sure they are in line with local standards and customs.
Comply with Local Regulations
Every country has a unique set of laws and regulations. For example, some countries are litigious, so it is essential to have strong legal processes to reduce commercial risks. Some government agencies also have strict requirements. They require you to have the right legal documentation before you launch a business in their country.
To expand to a foreign market, you need to learn different business regulations, adopt new packaging standards, and familiarize yourself with different tax codes.
Here are several steps to take to ensure your company’s legal readiness:
- Create localized commercial agreements.
- Ensure you obtain the required compliance and certifications.
- Standardize your general corporate services, such as customs, shipping, dispute resolution, etc.
Make Sure You Respect Local Tax Regulations
Only by having a detailed finance infrastructure can your company adhere to local regulations and operate smoothly.
For starters, consider outsourcing your accounting, payroll, and tax management to local bookkeeping and legal professionals.
Also, keep in mind that foreign banks may also refuse to deal with foreign business bank accounts. Therefore, you may need to open a separate foreign business account in a local bank.
Most importantly, create regular financial reports and build a detailed risk management plan.
Over to You
Sure, those are just some of the numerous steps you will need to consider when starting your business in foreign countries. Irrespective of the continent or state you are expanding to, always have a detailed business strategy in place.
Consider local market needs and focus on removing cultural and language barriers. Only that way can you build trust with your new audiences and deliver seamless customer service!