Many businesses are seeing the advantage in undertaking expansions into global markets. As the world gets more connected, it’s easier than ever to do business all over the world.
But for businesses that have traditionally only operated domestically, making the transition to access global markets can present a number of challenges. Commonly, these include, but are no means limited to cultural differences, legal requirements, and business structure.
Here are five key considerations to keep in mind whilst launching your business into exciting new markets:
Take advantage of technology
To be a success in your own country, you will probably have a highly functioning, streamlined website to demonstrate your products or services. To take this success across to whichever countries you approach next, you will need to make sure that the translated version of the site is well written.
Although English is widely spoken, residents of other countries may not fully understand the finer details. Offering the option to read text in their native language will encourage more people to visit the site. Deciding which languages to support depends on where you plan to sell, and as many languages as possible will help to increase your reach.
As well as considering the translation of words, an important factor to remember here is also the translation of all measurements. Where one country may use metric, another may use imperial. Your website will be a lot more user friendly if you have calculated these differences for your customers and figured out localised currencies too.
In addition to your website, a digital infrastructure can help support your global ambition with little setup cost. Cloud technology allows overseas staff to work as effectively as if they were in the head office. Being able to provide service support at local times, in the customer’s own language gives you a huge edge on other small businesses and even allows you to compete for business from local competitors.
Powerful personal technology allows regional teams or individuals to manage their workloads remotely from their laptop and smart phone
However, you’re dipping your toe into the international arena. Don’t buy expensive software systems that may not be needed until much later down the line. Look for simple cost-effective support for your in-country personnel. This strategy is much more cost efficient as you make your early transition into new markets.
Take advantage of local in-country expertise
Why go through the expense of training up your own people in the language, culture and legislative complexities within any country and have them start from square one? Work smart and pick up experts to enrich your talent pool and give you a head start in global markets.
Picking up some local talent is the quickest way to get access local expertise and knowledge and best way to understand the local business environment. Having boots on the ground, even one pair, can give you a huge edge in many markets, and help establish your international business.
For example, Germany has the largest economy in Europe. While all the big players have a presence, the real drivers are the Mittelstand, the SMEs that are enjoying a recent relaxation on restrictions. This has allowed them to flourish in the last 5 years. Local contacts and experts who have networks within this thriving market of SMEs can provide a wealth of valuable insights to your business.
Immerse yourself in the culture
Every culture has a different approach to doing business. In order to cultivate lasting relationships with business partners and clients, you need to walk a mile in their shoes and embrace the way they do things.
For instance, the formality of address is a big consideration when meeting people for the first time. Do they prefer titles and surnames or is being on the first-name basis acceptable? While it can vary across organisations, Asian countries such as South Korea, China, and Singapore tend to use formal “Mr./Ms. Surname,” while Americans and Canadians tend to use first names.
The concept of punctuality can also differ between cultures in an international business environment. Different ideas of what constitutes being “on time” can often lead to misunderstandings or negative cultural perceptions.
When presenting your website or other business assets, make sure you don’t offend any potential customers. For example, the number four in China, Korea and Japan is bad luck and sets are often grouped into three or five. A thumbs up symbol is offensive to Muslims, whereas it means everything is going well to a Brit.
For example, where an American may arrive at a meeting a few minutes early, an Italian or Mexican colleague may arrive several minutes after the scheduled start-time and still be considered “on time”.
Get an understanding of domestic compliance
Whether you choose to hire from within a country or send an existing employee to undertake the role, you need to get to grips with the payroll and HR nuances of the specific country.
On average, you need 14 pieces of employee information to process global payroll. These include employee name, age, pay scale, tax code, bank details and so on. More data means more complexity. In addition, you have to consider any regional reporting obligations you may face.
Key payroll dates differ from country to country, so logistics is as essential in payroll as it is in any other aspect of a global enterprise.
Timing is a prime example. In Spain, employee payroll tax is paid quarterly, by the 20th of the month following the respective quarter. All companies and all employees are subject to Social Security contributions payable to the State and payments are processed by an employer on their own behalf and on behalf of employees, monthly, in arrears. Every country has its own rules.
Every country’s revenue service has a number of standard requirements for all. Every country has a different take on employment contracts, so you need to be able to meet a variety of legislative requirements.
This is why France has the most complex payroll in the world. As well as needing 16 separate pieces of data to even pay someone in France, the French government demands much more detailed reporting than other countries.
Offer diverse payment options
As payment becomes increasingly contactless, it is important to offer as many local options as possible to all clients globally. Paypal is one way to ensure that no bank transfers need to in place and is widely accepted globally. Google, Apple and Android have all adapted to offer their own contactless payment services, which make purchasing through mobile phones a simple and smooth transaction. In addition, you will need to set up international banking methods for card payments to be made in local currencies. Every step of the way, you should consider the customer journey.
By leveraging technology, utilising local expertise, understanding the fiscal complexities, getting to know the culture and remaining focused on your business goals, any business can flourish globally. We live in a world where individuals are more connected than ever. So maybe it’s time your business made the transition into the global marketplace.