6 Tips for Companies Expanding into New Markets

As an entrepreneur or business owner considering expansion into another country, you’ll already know how important it is to consider all of the key areas of your organisation when doing so. Choosing to “go global” is a serious challenge even for businesses which are designed to pivot at a moment’s notice…

So how can you make sure that expanding into a new market isn’t going to sink your company?

Business partners discussing business expansion plans

1. Take stock of your current resources

Expanding your business into another country might sound like an easy way to get more clients and boost your turnover. It often is, but is your business prepared to handle your move from an organisational point of view?

Expansion will take both time and energy – not to mention financial resources – so you need to know that it’s going to be:

  1. Worth it
  2. Actually possible to accomplish

To this end, you need to perform a full audit of your current capabilities, and of the opportunities offered by the specific market you’re planning to expand into.

To start with:

  1. Perform a market analysis – with elements including a gap analysis to make sure there’s enough space and demand for your products and services, and a SWOT analysis to see how your products compare to other options already available.
  2. Audit the resources you have for this expansion – including all financial and organisational factors.

There are also some pretty obvious questions you should be asking yourself about your planned expansion.

2. Have a plan – and a sound financial strategy

It’s no good having a one-size-fits-all plan labelled “Expansion into New Markets”. Each market has economic and cultural conditions – not to mention other factors such as applicable local laws and business practices – unique to itself.

Your plan should be carefully localised to the specific market you’re planning to expand into.

  1. Define your goals – setting goals, specifically numeric goals with sets metrics that can be measured and clear timeframes, is vital to achieving success as your business enters a new market.
  2. Split your goals – once you’ve set your overall goals it’s time to split them into smaller “signpost” targets which you’ll hit along the way. These smaller goals should have their own timeframes for success and will show you how well you’re working towards reaching your final target.
  3. Consider your business structure – will your company handle expansion into a new market functioning as it currently does? For a web-based business, for example, you might not need a local branch, but you will certainly need a customer support team which is capable of fielding enquiries in the languages spoken by your new market. Will that require a separate sales office? It’s time to decide.
  4. Determine self-sufficiency – ideally, the operations you launch in the new market shouldn’t require the resources of your main business in order to operate. If you don’t have the resources to expand without hurting the operations of your main business, you don’t have the resources to expand. A clear financial plan will help you determine this.

It’s worth creating a clear plan listing measures you’re going to take, such as this example detailing Key Steps to Expand Your Business Globally.

Marketing strategy for business expansion

3. Set your marketing strategy – and have alternatives prepared

As always, proper research is the key to succeeding in any market – especially one you might know comparatively little about.

Your marketing strategy will need to be clear and comprehensive and feature all of the usual elements you’d include, such as:

  1. Key Performance Indicators and other performance metrics
  2. A clear definition of the market and potential customers base
  3. Identification of competitors
  4. Your price positioning – this is critical, particularly if you’re trying to sell to consumers in a less developed area, for example

All of this while staying true to your overall brand identity, values, and objectives.

Even after thorough planning and research, without in-depth knowledge of the target market, you might still have developed a strategy which does not work. For this reason, you should:

  1. Have one or two alternative plans already in place – you can quickly pivot to these if you’re not getting the results you expect.
  2. Form partnerships with local businesses – or locate experts who can provide effective localisation of your message (we’ll look at these in Tip #6 below).

4. Localise your products or services – legally and physically

As well as altering the price positioning of your products or services to meet the local market, you’ll need to translate and localise your products themselves to meet the expectations of your new audience and sometimes to comply to local regulations. For example, does the name of your product translate well into the local language? Will any images you use on the packaging make sense to local consumers?

To adapt your products in this way you’ll need effective translation and localisation services, whether provided by your in-house team or – for most small and medium businesses – your partner Language Service Provider (LSP).

The best LSPs will be able to help you navigate the legal waters of your new market too, by proving legal translation services and other kinds of language support. Many countries – such as China, for example – have a large number of requirements which need to be met before a company can begin to operate in the country (we’ve written a whole article dedicated to Things You Need to Know when You’re Expanding Your Business in China to give you some idea of the preparations you’ll need to make).

But when expanding into any new market, you should always:

  1. Check that industry and region-specific regulations are being followed
  2. Confirm that you’ve obtained all necessary certifications and permissions
  3. Determine how to localise your product
  4. Consider whether to perform localisation in-house or to outsource to a professional company
  5. Check for patents and trademarks
  6. Consider how you will distribute your product locally

Business team meeting for company progress report

5. Prepare your local team

Now that you know how you’re going to prepare your product, it’s time to think about preparing your team.

For instance, entering a new market generally means that company leaders will need to regularly travel to the area. Anticipating cost and organisational burdens such as this should be part of your initial stock-taking and planning (see Tips #1 and #2).

But that’s not really the sort of team preparation we’re talking about here…

Operating in a new market means that your staff will need to come to terms with how to act in a new culture, knowing all of the differences in languages, customs, and practices as well as legal regulations and the like. Yes, you’re going to want to stay within your brand identity and speak with you brand voice while doing so, but what customers in your new market might expect in terms of your commitment to “politeness” say, may differ widely from expectations in your home market.

You could:

  1. Write policies and procedures which tell staff how to interact with local customers if this is different to how they would normally do so
  2. Consider hiring qualified local employees
  3. Choose to work with your local partners

6. Find reliable local partners

Again and again we’ve seen how useful it is to work with local partners when entering a new market.

From the initial planning phase onwards – where it would be very useful to have local insight into how effective your marketing strategy is going to be – having access to an expert who’s familiar with the ins and outs of doing business in the part of the world you’re targeting will smooth the way for your company’s international expansion.

As an experienced entrepreneur or business owner, you’re bound to have a list of contacts who can offer advice. If not, it’s time to start building your network.

Partner companies who are used to operating in the local area can provide everything from translation and localisation services to efficient distribution of your products. By outsourcing in this fashion you minimise the financial risk of employing an entirely new in-house team at a time when you’re already expanding the scope of your organisation.

Overall, being able to adapt to your new market should be your goal. And making sure, should that adaption fail to work, that you’re ready to adapt again.

Localising Your Business to New Markets: Tips and Questions

Have we missed something important in our list? Do you have a related question about the best way for your company to expand into a new market?

Let us know in the comment section below!