Every business owner is bound to make a few slip-ups during international market expansion, but some missteps are costlier than others. Here, we count down six mistakes companies make when expanding business overseas, from the lighthearted to the heavy-handed, and offer guidance on how to avoid errors that could put a halt to your international plans.
Your employee flies to a country as a tourist and begins closing deals.
Though you can commend your employee for his or her zest for business, international expansion is not something to be jumped into haphazardly – and it often requires fulfilling certain legal requirements in order to seal deals compliantly. The next time your worker goes on holiday, tell them to leave business at home and enjoy their time off instead.
Your first contract is paid for, but you’re not registered to do business in your target country.
Proper registration is vital to building a compliant foundation for your international expansion. Whether you need to set up a legal entity or register as an employer, don’t be caught out by neglecting to secure the documentation you need to stay aboveboard.
You expand your ecommerce business into a country where wifi is scarce.
Though ecommerce has made it easier than ever to do business abroad, it’s not the best option for every country. Consider the quality of internet in your target country and evaluate the shopping habits of your target market. Do customers prefer to buy products or services in person? How highly do they value face-to-face interaction? Though ecommerce may sound like a no-brainer, you have to be sure it’s right for your expansion location.
You hire an employee in a new country without a payroll setup.
Making a new hire is exciting – but your new employee won’t be excited if they aren’t paid on time. Payroll errors negatively affect the morale of your workers and your overall company culture, and it can be hard to gain an employee’s confidence once mistakes are made. Be sure that your payroll systems are good to go before you bring in employees.
You attempt to do everything yourself.
As a business owner, you’re used to doing the hard work yourself. Even so, international expansion requires expertise in the complex requirements of your target market, and seeking the right help is key. Galvin International, an international expansion business concierge service, recommends hiring local specialists and outsourcers – their team will even help you implement the advice of these experts. You may have a take-charge entrepreneurial attitude, but some things are better left to other people.
You sign a contract with a partner without the right due diligence.
You connect with an overseas manufacturer, receive a sample shipment from them, and everything seems good to go. Time to sign the contract, right? Unfortunately, it’s rarely that simple. It’s essential that you conduct thorough due diligence on any partners you are involving in expanding your business abroad. In-depth research, paired with an in-person visit to the partner, can save you time and money in the future.
International expansion is a learning curve, but you can safeguard your business from mistakes through the right preparation. Take your global growth one step at a time and you’ll be on the right track for successful expansion.