In some ways, just being online creates a global presence.
Are you looking for a way to expand your business? Have you considered marketing your products beyond national borders? There are many opportunities for growth that can be achieved by exporting products, services or intellectual property.
While some companies may find entering the international market as easy as processing an international order through the Internet, others may need to build factories overseas in order to find international success. Regardless of how you enter the international market, you should do so only after researching and understanding the ramifications of international trade.
This article addresses some of the basic points of consideration. Identify Your Goals Goals for building an export program will vary for different companies and different product lines within a company. While the goal for one product may be to expand sales, another product may have come to the end of its market life domestically, but would be viable for an emerging market in another country.
Some companies may wish to sell their products in countries where they source from as a way to offset currency risk. Understanding your goals will enable you to evaluate the risk and cost you are willing to accept as part of your international program.
Risks While there are many risks associated with international trade, the most common issues are about intellectual property rights IPR.
While IPR issues may also arise domestically, the mechanisms for protection often stop at country borders. Patent and copyright protections are specific to each country with the laws, rules and remedies varying accordingly.
Consider the ramification of IPR theft on your existing business. Would sale or use of your IPR in another country hurt you? Is your product unique enough or difficult enough to reproduce to inherently protect you? You can help protect yourself from illegal fakes coming into the U.
Another common risk is currency fluctuation.
Currency fluctuations can cause difficulty while processing a transaction. If you are selling a product or service that will be paid immediately upon securing a contract, the risk associated with fluctuation is minimal.
However, if you conduct business that has a time-lag prior to payment, a fluctuation in the exchange rate could cause deals to go sour. While currency fluctuation can be a problem during a transaction, it can also open or close markets to you by changing your competitiveness.
For example, today the U. This change may have made your product competitive in an area where you were previously struggling. When conducting a competitive analysis, remember that exchange rates can fluctuate dramatically, thus changing your competitive position.
Product Evaluation Is your product suitable for the international market? The answer may vary for different countries and will encompass many aspects of the product.
The design, application, market price and name should all be considered. Will bolt patterns or pipe connections fit standards in your target market?
What about the market drivers? Many water treatment product sales are driven by regulations, as well as enforcement of those regulations. Some target countries may have regulations which would seem to create a market for your products, but if there is no enforcement, success may elude you.
Find out how the regulations compare to your domestic market. For example, a wastewater disinfection system designed to meet typical U. Is the product design suitable? Can your product be easily adapted to meet various market needs?
Will the changes be cost-effective? Product and company names also may be an issue.Jun 27, · Before expanding a company overseas carefully consider the pros and cons of establishing an international business.
Language and time barriers, varying currencies, legal ramifications and delivery. Expanding into thriving international markets is a goal for many businesses. Discover the risks and also the rewards of expanding a business overseas.
For Labit, an international expansion required looking at business through two different lenses: as a manufacturer and a retailer.
Cotton Babies not only sells baby products online and through a retail store in St. Louis, Missouri—it also designs, manufactures and distributes a few cloth diapering product lines.
Before expanding into foreign markets, Labit considered the pros and cons. Before expanding into foreign markets, Labit considered the pros and cons. “We wanted to offer our products internationally and to distributors, but couldn't do so at U.S. manufacturing costs," she says. The pros and cons of expanding a business internationally show that there are some increased costs, but there is a good chance to experience increased profits as well.
If a business can absorb the costs of expansion and has their international manufacturing process nailed down, then a company of virtually any size can develop a global presence. Jun 27, · Again, local company managers and a strong business relationship with an international bank, with branches in your target markets, provide vital on-the-scene problem-solving capability.
Expanding into thriving international markets is a goal for many businesses. Discover the risks and also the rewards of expanding a business overseas. The Pros and Cons of Expanding your Business Overseas - November 13, Simple Ways You Can Cut Business Costs - November 12, Tags: Business, Guide, overseas, Success, Tips, World, worldwide. The pros and cons of expanding a business internationally show that there are some increased costs, but there is a good chance to experience increased profits as well. If a business can absorb the costs of expansion and has their international manufacturing process nailed down, then a company of virtually any size can develop a global presence.