6 things to avoid before taking your business global
Not sure which markets to expand into, who to talk to or perhaps how to get the goods back into your home country? Taking that first step is often the biggest challenge when expanding overseas and coupled with the task of determining who you can trust, for most businesses it’s often the scariest one.
Here are six common pitfalls and how to avoid them, as told by the experts who have heard or experienced it all.
1. Launching in new markets before you are ready
“The first thing is getting the focus right. Entering into a new market is a big commitment and not something you do on the side. There is every chance that you’ll spread yourself too thin.” – Justin Dry, Vinomofo
Ensure you have clarity on your vision, the right preparation and don’t underestimate the degree of complexity involved. Remember it’s a process; start with one market, set yourself up, make some progress and then build on from that.
2. Trying to be the jack of all trades
“It’s incredibly tempting when you go overseas because you see all these adjacencies and you think I might just jump in and do a little bit of that. But every new market has a compounding complexity, from a new supply chain, new regulations, new people and new cultural nuances.” – Skander Malcolm, OFX CEO
Skander suggests staying fairly narrow in your product focus. In fact, one of the factors that have contributed to the success of OFX is that it’s kept it brutally simply. The core product has largely been unchanged, despite temptations to do otherwise.
3. Assuming because it works in your home country, it will work overseas
“We learned a lot from launching in New Zealand, which was our first overseas market. We overestimated how much we knew about the market, and our New Zealand operation has now evolved into something very different to what we originally thought it would look like." – Justin Dry, Vinomofo.”
In every market, there are different ideas on what the product will look like and how consumers will interact with it. Even the way in which you sell the product to the customer will vary. For example, in Australia businesses often sell on features and benefits. This would fall short in China, as aspirational marketing resonates more effectively with that audience.
Understanding the culture from the point of view of the customer, in terms of what they want to hear, how they want to be dealt with, and if they can even afford your product or service is super important. This also helps avoid miscommunication around cultural nuances and determines the extent to which localisation of the product is required.
4. Underestimating the importance of the right support structures
“Whoever you’re hiring, if you are going direct, it will not happen quickly. On that preparation point, take your time”. – Sarah Hamilton, Sand & Sky
Whether it’s your suppliers, advisors or partners, ensure you have the right people on your team who you can trust, who are vested in your company and believe in your story. On that point, Sarah Hamilton advises to not rush the process.
5. Deploying your most experienced people into new markets
“I’ve seen people send their best sales people into a new market, and then the local market starts to crumble because of it.” – Robert Southwell, Pitcher Partners
Rob suggests first asking yourself, ‘Do you have that strong local person who is vested in the company and can run the play for you?’. Getting that key point person in each market and having someone on the ground is imperative.
6. The one-size-fits-all pitch
"They’ll be different pitches depending on who you’re speaking to. Your pitch for your partners is not going to be the same as your pitch for your clients or your customers. Even country to country might be different.” – Cynthia Dearin, Dearin & Associates
To get your pitch right, Cynthia suggests constantly testing and pitching it to as many people as you can and observe what their reactions and responses are.
Are you ready to expand into the overseas market?
With the right research and guidance you can take the leap and expand globally. Be sure to carefully consider the pros and cons of going abroad, and ensure you can be profitable in your approach long term.
Having a currency strategy in place is one key consideration, and at OFX we are always striving to help our clients master market volatility and save on the exchange rates and fees charged by the banks. And with speed so crucial to round the clock operations, we aim to improve payment settlement time wherever possible, so you can get your money where it needs to be faster. With 16 global banking relationships, most of the time when you transfer money with us, the funds go into a local bank account in your country, and come out of a local bank account in the recipients' country. That means we can often offer same day or next delivery to major markets once we receive your funds.
Wherever you're growing - get in touch with OFX, for an expert partner in international payments