From choosing the right market to having a payment plan in place, this is your cheat sheet to growing a global business.
If I had a dollar for every time someone asked me what it takes to go global, I’d be one rich woman. It’s not one thing that propels you to success. Rather, it’s a series of things that must be done well that will get you that much closer to improving your overall growth potential and conducting business with customers the world over.
17 tips to grow a global business
Here’s what it takes for an organization – big, small or even upstart – to grow beyond its borders.
1. Be in the ready state.
Are you in the ready state to take your business global? Take stock of both yourself and your business to see if you have the personality, mindset and business that can benefit from going global.
Do you have a global mindset, the ability to deal with the unknown and venture out in the world and adapt as you go?
A global mindset starts with self-awareness, reflects an authentic openness to and engagement with the world, and employs a heightened awareness to the sensitivity of cross-cultural differences.
2. Get a companywide commitment.
Whether you run a one-woman show or head up the international division of a Fortune 500 company, get buy-in from everyone.
You can’t operate in a vacuum. To set the stage for winning, play the part by getting everyone – from the social media manager to the finance manager – to jump on board for global growth.
3. Choose a market.
Pick a market that’s easy to get in and out of, has minimal red tape, the country’s government promotes international trade, there’s a Free Trade Agreement in place — but most important of all — choose a market where you know there are customers for your product.
4. Develop a market entry strategy.
What will it be and what is it based on:
- direct exports
- indirect exports
- joint venture
- foreign office
- global strategic alliance
… and so forth?
If you are new to expanding internationally, exporting is a great first step because you can test the waters without a big upfront investment.
5. Establish a payment plan.
Hey, we got a sale, and the product is on the way. Now ask yourself this: What payment plan did you set up with your customer? Structure the deal in such a way that the product gets sold and you get paid. Ask your banker for help.
6. Learn how to set prices thoughtfully.
Be competitive but ultimately, when it gets down to the bottom line, prove that your quality and consistency win out every time. Some customers might try other products, but eventually they come back to yours because of superior quality and consistency of manufacturing — not because your pricing is the cheapest.
For tips on how to price products for global shipping, read “Tips for pricing products for global shipping.”
7. Make sure you are financially sound.
So often folks think they can rely on the profitability of their home-based business and some can, but you don’t want to weaken the state of your successful local business to satisfy the requirements to sell your products overseas. Analyze your available resources (human, material and financial) to determine how you will support global initiatives.
You want your global business to be profitable and sustainable over the long term.
8. State your rock-solid payment terms upfront and stick to them.
So often we get ahead of ourselves, focus on the excitement of the sale, and later regret that we didn’t hash out the payment method better and well in advance of finalizing the transaction. Don’t let the honeymoon period of the relationship get the best of you. Stay grounded and pinch yourself as a reminder that you are running a business that must earn profits — and getting paid is one way to snag them.
9. Tailor your products to the needs of the overseas customer.
Trying to force a customer to buy what you have available, with little or no willingness on your part to make improvements, is not only insensitive but also downright hostile. Build trust in each new market, and this can only be done by localizing your offerings.
10. Protect intellectual property.
Intellectual property should be protected well before you begin selling to overseas customers to avoid losing ownership and subsequent revenues. That includes all your internet platforms that you own — websites and blogs, for example. Consult with a good international lawyer.
11. Get information well in advance of your global initiative.
Many clients say this to me:
“Our product cannot compete overseas or locally because the tariffs are too high.”
Get information well in advance on tariff and tax obligations for your products or those of your supplier in the country in which you are about to do business. You don’t want to erode your profits or, worse, impede your ability to compete just because you found out way later that tariffs are so high it is impossible to price your product competitively against local firms.
12. Ask distributors what they anticipate selling.
Oftentimes I hear this from a business owner:
“We appointed an exclusive agent, yet didn’t get any sales.”
When exporting a product, ask distributors what they anticipate selling in the first year. Then monitor and exercise good control over a distributor’s sales. Find out in advance what products distributors sell to ensure they do not sell brands that compete with yours. And keep an escape clause in place just in case things don’t work out with a distributor.
13. Move your products efficiently.
The three major global transport players, UPS, DHL and FedEx each have capabilities that move a product from local Point A to overseas Point Z. But also look at new entrants in the industry, such as Freightos, Flexport and WebCargoNet. These nascent transport companies promise to reshape the transport industry with instant freight quotes, online bookings and 24/7 support.
14. Meet with your customers.
Yes, we have email, Skype and Google Hangouts, but you can’t afford not to meet with your first customer because without face-to-face contact, there will be no repeat business.
Build enriching relationships and the return will be rewarding in all respects.
15. Practice cultural sensitivity.
If you don’t have good manners or know how to communicate effectively locally, how will you ever conduct business with someone 12,000 miles away who doesn’t speak your language?
It’s a skill that enables us to learn about and understand people who are different from ourselves, which allows us to better serve them on their own terms.
16. Diversify at some point, after you have achieved some reasonable success.
Don’t put all your eggs in one basket. Meaning, diversify your customer base, diversify your offerings, and diversify when you can into other overseas markets. This way, when one thing goes wrong, everything doesn’t fall apart on your global strategy.
17. Provide great customer service.
Service brings satisfaction, and satisfaction brings repeat orders. Keep in constant touch with your customer. And make sure the plane or ship delivers the goods on time and in good condition. Too many global businesses overlook the logistics of supplying an overseas market.
These 17 factors are all part of the process of turning your global aspirations into a reality. Your best chance of growing a global business lies in developing a plan, executing on it, and developing strong connections within your new markets.