Your business is booming, profit is increasing, your company is growing. It’s an exciting time.
So is it now time to look at global markets?
Today we examine the practical steps you can take to prepare for the challenges ahead.
Signs you’re ready to go global
While all businesses differ, we can identify common themes that may indicate that it’s time to expand into new markets. By considering these points and comparing your business against them, you begin to paint a picture of your preparedness.
Your customer base has shifted: As business owners, we potentially have a wealth of data and advanced analytics tools at our disposal. This makes identifying changes in customer base simpler than ever before. Confirming a shift may provide evidence that your business is ready to go global and it can also indicate ideal starting locations for expansion overseas.
When reviewing your company’s data, it is vital that you are confident in its hygiene – how up-to-date, complete and error-free it is. Basing such a significant shift on data that is of poor quality has sunk many an entrepreneur’s goals for entry into the global market.
When reviewing your company’s data, it is vital that you are confident in its hygiene – how up-to-date, complete and error-free it is.
If you are uncertain of the quality of your data but believe it may be indicating an overseas shift, you have options with which to test the notion. Advertising platforms such as Google AdWords can be used to test modest pay-per-click budgets on highly specific and targeted demographics. Use of such tools, when cross-referenced against the performance of similar activities in your local market, may confirm your suspicions in this regard.
Overseas interest: Separate from your outbound marketing and advertising activities, a sure sign of your readiness for the global stage are enquiries made from businesses outside your local market. The interest of a company which operates in an entirely different region is a positive indicator of the development of your brand image and apparent performance.
An effective way to gauge this interest is through trade shows. When you – or your team – are exhibiting at a show, it’s important to make use of the time to speak to other businesses and not just prospects and visitors. This is especially true in this context, as a trade show is an ideal opportunity to network directly with leaders and senior decision makers.
It’s a simple, yet proven tool; over 88,000 entrepreneurs polled in a 2015 study on transitional networking were found to emphasise networking with peers prior to an ‘operating phase’ such as global expansion. A separate study focused on foreign market entry similarly concluded that businesses which have successfully expanded globally tend to nurture relationships within their domestic markets first, which are then followed into foreign markets more easily.
Through discussing the subject of going global with other companies in such a setting, you can learn hard-earned lessons quickly and can informally test other entrepreneurs for their response and assessment to your plans.
You’re close to the competition: While fluctuation in your local market is often a reason to make the push to the global stage, it is not an indicator in itself of your readiness to do so. The vital distinction here lies in comparison – namely, the stability and performance of your overseas competition.
After reviewing the state of your business in its local market – whatever that may be in terms of stability – you can identify opportunity overseas by reviewing the performance of similar operations within countries you wish to expand into.
If your research can identify a business that provides a similar service that is enjoying success in the desired location, invest time in scrutinising their situation. Are there any elements of the company that stand out, such as a customer-driven approach or a trend in marketing and PR activity? Once identified, you can consider incorporating these into your own business.
Mainland expansion makes sense: Moving from free zone to mainland is the natural hallmark of expansion for UAE businesses. Accessing the diverse and rich mainland economy may go hand in hand with the viability of pushing your reach overseas.
For instance, the more generous rules for number of employee visas and greater potential for diversification of products and services that are associated with the UAE mainland could be exactly the advantage needed to access overseas markets and rapidly capitalise on subsequent growth. The variety of businesses and entrepreneurs found in the mainland may also prove valuable to you from a networking perspective.
Laying the foundation for global success
With the viability of expanding your business identified, work can commence on preparing your company so that it can survive and succeed during a period of significant change and disruption. While accessing global or overseas markets is a positive and profitable stage in the growth of a business, it is not without danger and should always be prepared for thoroughly.
Take it slowly: Working to expand your business network to include experts and decision makers within your desired locations, for instance, will not happen overnight but will be to your advantage in time as you come closer to taking decisive action. Similarly, changes to the structure of your business – including talent acquisition – can be considered in advance to prepare you for the new demands of global expansion.
Establish a limit of risk: Your venture into global markets will never come without risk. It is important, however, to avoid the ‘allure’ of that risk. Entrepreneurs are commonly defined as those willing to take risks in exchange for greater profit, but this is a narrow definition and is a dangerous concept to embrace blindly. A recent study concerning the ‘orientation’ of entrepreneurs – essentially their preferences and styles in business – and performance during the early stages of growth found that aggressive risk-taking had no real value in improving performance.
While your expansion and growth will involve risk, it is vital for you to set clear limits on how far you are willing to go in this regard. Many businesses have failed in their growth periods due to the mistaken belief that there must be risk involved, and that the greater the risk the bolder and braver their venture. This is an amateur’s perspective; the successful entrepreneur instead will have defined limits and a more objective approach.
While your expansion and growth will involve risk, it is vital for you to set clear limits on how far you are willing to go in this regard.
Ensure staff buy-in: Taking the time to be certain of your team’s willingness to push the business further in such a drastic manner is vital. Without full buy-in from your employees, the shift in priorities, workload and culture that come with such a move may disrupt them so much that productivity suffers at best and talent is lost at worst. A study published in the Journal of Small Business Strategy investigated employee retention in growth-oriented entrepreneurial firms. It showed that high growth periods often upset both work-life balance and the opportunities for employees to work on specific tasks and their own career goals. Both were found to negatively impact employee retention.
Communicating clearly and fairly with your employees well in advance will protect your company from these dangers. Let them know what’s on the horizon, and how it will impact their day-to-day lives as working professionals and team members. Cascading and sharing your strategic plans – and ensuring you have a robust means of receiving feedback – is key to making your growth truly sustainable from a human resources perspective.
Going global the right way
There you have it; two stages of achieving a safe transition to the global market. By identifying the signs of your preparedness for growth and expansion – and scrutinising those signs closely – you verify whether now is indeed the time to act. Subsequently, by laying a solid foundation where your objectives are defined, and your employees considered, you increase your chances of lasting success.
Growth is never easy and going global is no exception. Armed with the right knowledge, however, it’s an exciting time in the expansion of your business.