Checklist for International Growth

Expanding your company abroad is always challenging, but the benefits can be enormous. Our 9-point checklist provides the tools to create a consistent international strategy.

Growing companies need to consider a wide variety of factors when choosing and entering new markets, particularly at a time when international trade conditions are unpredictable. Your planning should be broad, detailed, and dynamic, from macroeconomic forecasts to specific business considerations.

In addition to identifying these critical factors, our checklist includes lessons from those who have helped companies grow internationally and essential issues to consider for your company.

1.    Clarify your international strategy. The global opportunities for ambitious companies are vast. Leaders often face a range of possibilities and a wall of information. The challenge is to understand your priorities and build the right strategy.

You need to identify the core of your business, where the investment should go to grow the company, not harm the brand in a new market, and select areas that are not critical for the company so that they can be outsourced. Resources can be focused on what is essential for growth.

When creating a vision, it is crucial to understand your business's values, existing strengths, and competitive advantage. This will help you identify the international opportunities that best fit you and increase your chances of success.

2.    Learn from previous international expansions. Companies that have expanded into new markets have much experience to reflect upon. Leaders should consider their current global footprint and ensure that existing and future operations are consistent with the strategy and aligned with the strengths and goals of the company.

With previous experiences, evaluate how prepared your business is for further expansion and identify the best structure. For example, the structure used for a previous expansion may not be suitable for the next one.

The chosen structure should align with commercial viability, so decide what you are trying to achieve and what you need to do that, and then seek the appropriate structure to achieve that result.

These alternative structures include direct investment, joint ventures, franchises, wholesale export, or direct-to-consumer online sales. You must also fully appreciate international expansion's impact on your business operations.

3.    Narrow down potential new markets. Once you have a clear international strategy and have learned from previous expansions, narrowing down your potential new markets is time consuming. Conduct thorough market research to identify countries or regions that align with your business goals and have favorable market conditions for your products or services.

Consider factors such as market size, growth potential, competition, regulatory environment, cultural fit, infrastructure, and political stability. Look for markets that offer opportunities for sustainable growth and where you can differentiate your offerings.

Evaluate the demand for your products or services in each potential market and assess the purchasing power and behavior of the target audience. Look for trends and changes in consumer preferences that could impact your business.

It's also important to assess any potential barriers to entry, such as trade restrictions, import/export regulations, intellectual property protection, and local business practices. Evaluate the cost of market entry and ongoing operational expenses, including distribution, logistics, and local partnerships.

Prioritize markets that align with your strategic objectives, have high growth potential, and are feasible for your resources and capabilities. It's better to focus on a few key markets where you can establish a strong presence rather than spreading yourself too thin across multiple markets.

4.    Develop a market entry strategy. Once you have identified your target markets, developing a market entry strategy for each is essential. This strategy outlines how you will enter and establish your presence in the new market.

Consider the following aspects when developing your market entry strategy:
●    Market positioning: Define how you will position your products or services in the new market. Determine your unique selling proposition (USP) and tailor your offerings to meet the specific needs and preferences of the target audience. Adapt your marketing and messaging to resonate with the local culture and language.
●    Distribution channels: Identify the most effective channels for reaching your target customers. Explore partnerships with local distributors, retailers, or online marketplaces with an established market presence. Assess the logistics and supply chain requirements to ensure the smooth delivery of your products or services.
●    Pricing strategy: Determine your pricing strategy based on market research and analysis. Consider factors such as local pricing norms, competitive landscape, cost structure, and perceived value of your offerings. Be flexible to adapt your pricing strategy as you gain insights from the market.
●    Marketing and promotion: Develop a localized marketing and promotion plan to raise awareness and generate demand. Leverage various marketing channels such as digital advertising, social media, influencer marketing, and traditional advertising methods, depending on the target market's preferences. Consider cultural sensitivities and adapt your messaging and visuals accordingly.
●    Legal and regulatory compliance: Ensure that you understand and comply with the legal and regulatory requirements of the new market. This includes obtaining necessary licenses and permits, complying with local tax and accounting regulations, and adhering to consumer protection and data privacy laws.
●    Establishing local presence: Determine whether you need a physical presence in the new market. This could involve setting up offices, manufacturing facilities or hiring local representatives or employees. Alternatively, you can explore partnerships with local businesses to establish a foothold in the market.

5.    Adapt your products or services. To successfully enter new markets, it's crucial to adapt your products or services to meet the specific needs and preferences of the target audience. Conduct market research and gather feedback from potential customers to understand their priorities, pain points, and cultural nuances.

Consider the following aspects when adapting your offerings:
●    Localization: Customize your products or services to align with local preferences, language, culture, and regulations. This may involve translating marketing materials, user interfaces, packaging, and documentation into the local language and making necessary modifications to comply with local regulations.
●    Product modifications: Assess whether any changes or enhancements are needed to suit the local market better. This could involve adjusting product features, sizes, flavors, or packaging to cater to the target audience's preferences or usage habits.
●    Pricing and affordability: Evaluate the pricing structure of your offerings to ensure they are competitive and affordable in the new market. Consider local income levels, purchasing power, and competitors' pricing strategies.
●    Regulatory compliance: Ensure your products or services comply with local laws, regulations, and quality standards. Be aware of any product certification or labeling requirements specific to the new market.

6.    Build local partnerships. Building strategic partnerships with local businesses, organizations, or individuals greatly facilitates your entry into new markets. Local partners bring valuable market knowledge, networks, resources, and established relationships, which can help you navigate the challenges of entering a new market.

Consider two types of partnerships, distributors and retailers or suppliers and manufacturers. First, identify reputable local distributors or retailers who can help you reach your target customers. Look for partners with an established distribution network, market expertise, and a good reputation. Or, if you require local suppliers or manufacturers to support your operations, seek partnerships with reliable and quality-conscious businesses.

7.    Conduct a competitive analysis. Understanding the competitive landscape in your target market is crucial for a successful market entry. Conduct comprehensive competition research to identify key competitors, their strengths and weaknesses, market positioning, pricing strategies, distribution channels, and customer base.

Research and identify direct and indirect competitors operating in the target market. Analyze their product offerings, market share, reputation, and customer base. Evaluate their strengths and weaknesses to identify areas where you can differentiate yourself and gain a competitive advantage.

Also, pay attention to customer feedback and reviews about your competitors' products or services. Understand their strengths and weaknesses as perceived by customers, and leverage this knowledge to improve your offerings.

8.    Develop a localized marketing and sales strategy. To effectively penetrate new markets, it's essential to develop a localized marketing and sales strategy tailored to the preferences and behaviors of the target audience. This strategy should align with your business objectives and consider the market's unique characteristics.

Divide your target market into specific segments based on demographics, psychographics, behaviors, or other relevant criteria. Determine the most effective marketing channels and tactics to reach your target audience. This may include digital marketing, influencer partnerships, traditional advertising, or direct marketing. Prioritize media channels that your target audience is most likely to engage with.

Determine the most suitable sales and distribution channels for your offerings. This may involve direct sales, partnerships with local distributors or retailers, e-commerce platforms, or online marketplaces. Evaluate the pros and cons of each channel and choose those that align with your target market and business objectives.

Lastly, develop strategies for building and maintaining strong customer relationships in the new market. This includes providing excellent customer support, personalized experiences, and ongoing communication to enhance customer satisfaction and loyalty.

9.    Establish a monitoring and evaluation system. Once you have entered the new market, it's crucial to establish a monitoring and evaluation system to track your progress, measure the effectiveness of your strategies, and make necessary adjustments.

In conclusion, entering new markets can be complex and challenging, but a well-planned approach can also present significant growth opportunities for your business. By following the checklist provided, you can navigate the market entry process more effectively and increase your chances of success.

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* Grant Thornton partner firm in Spain published the original article we adapted to our market with permission.