Before starting a business or opening a branch office in another country, you should bear in mind that what works within your market may not work in others.
As well as the product or service itself, the legal side of things (legislation, bureaucracy, taxes…) is also extremely important, especially if you intend to break into a market in a country with a very different legal and administrative framework to that in place in the European Union.
Therefore, it’s essential to take into account the following:
Eight things to consider before expanding your business abroad
- Do you like the culture of the place where you’re going to carry out the expansion? If you’re going to have to be in a place and understand its culture, it’s better to feel comfortable. So if you don’t like the cold, maybe it’s best not to venture to Russia, for example…
- Does the product or service you wish to sell have a place in the target market? Does it need to be adapted to the new environment? I.e. it doesn’t make much sense to sell coats and umbrellas in a place where it’s never cold or rains. However, you could, for example, adapt the product so that, instead of protecting people from the rain, it helped them avoid the sun.
- Is society ready for your product or service? If people aren’t used to using carwash services, for example, you’ll have to think about whether it’s worthwhile “educating” your potential customers (creating a need) in order to sell your product later. Remember that the first one to break into a market has a big advantage over their competition, but they may also come away with nothing.
- What is the infrastructure like in the country in question? Do you have everything you need in order for the company to function? (Is the location properly equipped? Have you sorted communications and internet? Do you have a supply of materials? Logistics? Human resources? High or low-skilled workers? Financial services…?)
- What are the laws like in the new country? Are there regulatory or legal barriers for external capital or businesses? Do you need a local partner in order to be able to start/manage the business?
- Are you motivated, prepared and, ultimately, do you have the resources to successfully carry out the expansion? Is it really a question of life or death? Do you have to expand so as not to lose your position within the market?
- What are you aiming to achieve by expanding? Is it realistic? When should you have achieved your goal(s) by? What will happen if you don’t reach your goal(s)? Put together a list of the reasons for taking on all the extra work that will come your way and leave it somewhere you can see it.
- Who can help you with the expansion? Where can you find advice on any legal or administrative issues? Who can help you with marketing and adapting your product or service to the new market?
As you can see, aside from translations by Mondo Agit, you’re going to need a lot of help. So, if you’re thinking of opening a branch office abroad, speak to us. Thanks to our knowledge of other cultures, we guarantee that we can become the partner you’re looking for on your foreign adventure.
In the next post, we interview Irena Domingo, who will tell us how to start a business in Russia. She’ll definitely have some interesting things to tell us.
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