March 20 2022 - If you are in a position where you are considering expanding your business on an international level, thatís great news! However, there are many different important things that you need to consider before you internationalise your business. There are a significant amount of financial, cultural and legal implications that need to be addressed, some by yourself, others with professional help.
From being prepared to adapt and working closely with experienced international accountants, to tax regulations, supply chain, insurance and website changes, internationalising your business shouldnít be rushed.
So, letís find out some of the important things to consider before internationalising your business.
Be Ready To Adapt
The first thing that you need to know when it comes to internationalising is that you need to be ready to adapt. It is not very often that a business can remain the exact same and be able to trade internationally, as every culture has very specific nuances that mean a product might not just be accepted as it is. Being prepared to adapt your product, marketing and general outlook on the business is vital.
When it comes to trade, you also need to be mindful of potential misunderstandings. Every country has different etiquette rules, so be patient and polite. Do your research in advance and speak to contacts in those countries to find out more about the most appropriate ways to behave, both professionally and personally. If there are misunderstandings, approaching them with respect and an understanding of cultural differences is important.
If you are not in a position to think outside of the norms of your culture when it comes to your business, then you are probably not in a position to internationalise just yet.
Work With Someone Experienced in Internationaliation
When internationalising, you should also work with a consultant who is experienced in the process and has been through it many times. This way, you will constantly have someone by your side to guide the business through each stage of the internationalisation, to provide important insights where necessary and to use their contacts to make the process as smooth as possible.
Working with someone who is well recommended is important, so you know that they can be completely trusted. This could have such a positive impact on the process and internationalisation shouldnít begin until you have an experienced consultant by your side.
Involve Your Finance Team From The Very Beginning
As well as having an experienced consultant, it is vital to involve your finance team from the very beginning of the process. Being realistic about the financial situation of the business, and whether you are in a position to expand without finances holding you back in any way, is essential.
There are so many unexpected costs that come with internationalisation, as well as all of the ones you already know about, so having a significant amount of wriggle room financially to cover these unexpected costs is a must.
If your business is in a position to expand internationally, you are likely to have an internal finance team. If this isnít the case, work with trusted international accountants who will be able to support you and provide realistic information about whether or not internationalising is a good idea in regards to the current financial position of the company.
Investing in Credit Insurance
Once you have established whether internationalisation is viable for your business, and you know it will be profitable, you need to make sure that you protect your business when trading internationally. To do this, you need to invest in credit insurance.
Trade credit insurance provides cover for businesses if customers owe them money and do not pay their debts. There are so many different types of credit insurance, so working with a credit insurance broker is always advised. There are very small differences between different types of credit insurance that could make a significant difference when it comes to making claims, so the expert advice from a trustworthy broker will go a long way. This way, you will be working directly with an experienced broker who knows how to get you the right cover for the best price. If you do ever need to claim in the future (which of course we hope that you donít), then you will be able to call your broker and they will deal with the claim for you, rather than needing to try and chase the claim with lots of different customer service people.
To keep your business safe through foreign trade, investing in credit insurance is a must!
Build Relationships To Take Your Business International
Last but not least, it is important that you build relationships with people internationally to make your business as successful as possible. These might be interpreters, potential customers, marketing professionals or consultants who can give you valuable advice. This ties in with making sure that you understand the culture and demands of that society fully, rather than going in blindly and expecting your business to be a success. Networking internationally before your business goes global is key to success!
One great way to do this is to help businesses wanting to trade in your country, providing advice and guidance, as well as a cultural understanding. When you help people to navigate, they will become a good contact more often than not that you can utilise in the future. Even if internationalising isnít something you are planning on for 2-3 years (often this is how long the process can take to do it properly and to conduct thorough research), try to start building your connections now! You will reap the benefits later down the line.
Internationalising can make or break a business, so making sure that you get it right from the very beginning is essential. The worst thing you can do is rush into internationalisation and waste a significant amount of time and money. Invest the right amount of time and money into this and you will reap the benefits in the future.
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