S3 Blog

As a business grows it is often the next logical step to expand into new markets, and this can sometimes mean doing business internationally. This is a big step for any business and it requires quite a lot of work to ensure that all international business is conducted in the correct manner and is not in breech of any foreign laws or regulations. So if you are thinking of doing business internationally – what do you need to know

• Is the product or service you trade in legal? This could seem like a strange question as you have been trading for X amount of years in your own country and not broken any laws, but these are the laws of your country. Make sure that you will not be breaking laws of specific countries you are considering trading in otherwise you could end up with fines or worse.

• Make sure that you are paying the correct amount of tax and check the import and export laws and abide by them. Failure to do this can result in fines and a business not being able to trade in other countries, something which must be avoided at all costs.

• Would it be worth forming a strategic alliance with the company in another country? Often this is a great way of breaking into new markets, and the company that you form an alliance with can help your business in its home country and vice versa. Having the backing of a company in the country you wish to move into can be a massive boost to a business.

• Would it be beneficial if someone in your business spoke the language of the country or countries that you are considering trading with? This can make business communication so much easier and it will also show that your business is dedicated to making international trading easier for both parties.

• Do a little research in the countries that you plan on trading in - this will enable you to get a good idea at the customs, culture and politics of the country that you are moving into. I understand more about the country business will be able to be much more successful in their transactions.

• If you are selling a product that needs to be assembled, does it travel well? If not you might like to consider setting up a factory in another country in order to assemble the product for delivery within that country. Doing this can cut down on customer complaints from broken or damaged products and it can also work out to be cheaper than manufacturing and shipping goods from another country.

• Do a little research about the country you are shipping into, there are so many different laws regarding exporting which are all different in different countries. So do your research first and make sure that you have all the necessary paperwork in order to do business internationally.

Markets in economic terms are defined as any infrastructures, systems and procedures in which buyers and sellers exchange services, information or goods – when money is exchanged for any of these it is known as a transaction. When you have a business it can be a huge benefit if you can successfully expand into new markets as this can bring increased revenue and raise the profile of the business – if you get it right. Get it wrong and you could run the risk of losing a great deal of money, something which should be avoided at all costs.

With this in mind it is important that when you are expanding into new markets you have thought about all possibilities and done as much research on the market you will be expanding into as possible. Before any expansion can begin you need to decide how you want your business to expand into new markets – are you looking to expand geographically or do you want to aim for target market expansion, where you offer a new product or service?

There are advantages and disadvantages to both types of expansion, for instance if you choose to expand geographically you have an advantage in the fact that you already know and are comfortable in your current market. So in theory expanding into a new geographical market should not present you too many problems. However one of the cons to this type of expansion is that the product or service that you sell might not be suitable for a different geographical market, so do plenty of research beforehand and make sure that expansion in this way is the right choice for you and your business.

If you are looking towards target market expansion you need to decide what market you will be targeting, for instance if you already sell a type of drink that is aimed at adults why not think about selling one that is aimed at children? This way you can get a larger portion of the drink buying market as you are targeting a market that is made up of both adults and children, yet you are still comfortable trading in a similar market to your original one.

Regardless of which way you plan to expand into a new market there are a few things that you should bear in mind. To begin with start off slowly, don’t plough too much money that you can’t afford to lose into your expansion. That way if things go wrong you are not risking too much financially. You should also make sure that you have done plenty of market research to see if expanding into a certain new market is a viable option for you, if not forget about it and concentrate on a different market that would be more profitable. It is also wise to make sure that you have a business plan to work to that way you will know what you want your expansion to achieve and how you are going to make sure that happens.