6 Crucial Steps for Creating Your Global Expansion Strategy

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6 Crucial Steps for Creating Your Global Expansion Strategy

Taking your business global has many advantages, but doing so without a solid global expansion strategy can set you up for failure. Read our global expansion strategy top tips and best practices to discover how planning ahead can help your business thrive in lucrative new markets.

Taking your business global has many advantages, but doing so without a solid global expansion strategy can set you up for failure. Read our global expansion strategy top tips and best practices to discover how planning ahead can help your business thrive in lucrative new markets.

Uriel Eldan

6 Crucial Steps for Creating Your Global Expansion Strategy

Global expansion is undoubtedly one of the best ways to tap into new markets, acquire world-class experts, and set your company up for long-term success. But without a solid strategy, global expansion is near-impossible and can result in delays, extra costs, and wasted resources.

This guide will give you a clear understanding of what a global expansion strategy is and how your business can formulate its own plan successfully. You’ll learn the best practices for planning market expansion step by step, from the consideration phase to launch.

How to Create a Successful Global Expansion Strategy

Creating a robust global expansion strategy is a big task; it requires enough time, dedication, and resources. But it’s not an impossible feat, and when done right, your global expansion plan will make scaling your business far easier and more successful in the long run.

1. Set Company Goals to Guide Your International Business Strategies

Before you jump into any business expansion, whether it’s local or global, you first need to set clear company goals. This will give you and your teams direction and purpose for the short, mid, and long term, driving the business forward sustainably.

Setting company-wide goals will help you to understand where global expansion fits into your company vision and which goals it can help you achieve. It’ll also help you prioritize certain aspects of global expansion, set aside an appropriate budget, and give you a clearer timeframe for when you need to achieve each step in the expansion process.

To help you set achievable company goals, there are many frameworks you can use, such as OKRs (Objectives & Key Results) or WIGs (Widely Important Goals). But whichever framework you use, your goals should be S.M.A.R.T.:

2. Do Thorough Market Research

Once you’ve set company goals and understand where global expansion fits into them, you need to carry out thorough research into the markets you wish to enter. This will help you identify opportunities and obstacles before you start spending money to execute your expansion strategy.

  • Is there a demand for your product or service?
  • What is the total addressable market (TAM)?
  • What’s the socio-political and cultural landscape like? Is it ready for a product like yours?
  • Who are your competitors and can your product or service offer something new?
  • How will the local laws and regulations affect your expansion plans? Can you overcome these barriers?
  • Will you need to invest in localization to make your product or service successful in the new market?
  • What kinds of talent are readily available in the target country? For example, does the country produce high-quality academics, leaders in a specific industry, or an abundance of tech talent?

There are many tools you can use to help make researching target markets easier, such as country-specific databases like the OECD. Once completed, you should have a better idea of which markets to prioritize in your global expansion strategy.

While the end goal may be to expand into dozens of countries across all continents, it’s best to stick with a select few high-priority, low-risk markets to begin with. You could start by expanding into Europe or another strategic area, for example.

Colorful post-it notes on a board

3. Evaluate the Different Types of Global Expansion Strategies Available & Choose Wisely

There are many ways to expand your business abroad, and what works for one company may not work for yours. Use your market research, company goals, and budget to determine which international expansion strategy is right for your company. The main types of expansion strategies are:

Each market expansion strategy has pros and cons. For example, licensing is fairly inexpensive and allows your business to expand rapidly, but it can lead to a loss of control over quality, messaging, and reputation.

Which Option Should You Use to Expand Internationally?

Choosing the right business expansion strategy depends on your timescale, budget, and goals. Global expansion isn’t just for big corporates anymore, but the size of the company will likely determine the type of expansion strategy you use.

However, for start-ups and SMEs with a lower budget, partnerships, licensing, and exportation may be more cost-effective methods of global expansion that allow you to get your foot in the door.

At Omnipresent, for example, we use a mixture of owned entities and strategic partnerships to carry out our own global expansion strategy. Our two main reasons for expanding internationally are:

4. Hire the Best Local Talent

Hiring local talent can make global expansion simpler and more cost-effective, especially if the target market is very different culturally and linguistically from your existing markets. Having staff on the ground helps you to:

How to Hire Local Talent

Hiring remote employees abroad may seem daunting. After all, setting up a local entity in each new market can be time-consuming and requires a sound knowledge of local regulations for compliance. You may be tempted to hire independent contractors instead, but that can be risky, too.

The simplest solution is to partner with an Employer of Record (EOR) service, like Omnipresent, which employs staff on your behalf and handles all the associated administration for you. Using an EOR is faster and less risky than employing international talent directly, and it’ll make the global expansion process much smoother as a result.

Sources:

https://www.omnipresent.com/articles/how-to-create-a-global-expansion-strategy

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