Hola, Здравствуйте!, nǐ hǎo...Is International Part of Your Growth Plan?
Thanks to modern technology, even the smallest business can now do business around the world. However, just because you can do business internationally does not mean it's a good choice for you. International business dealings present several struggles, including everything from culture and language barriers to shipping costs. Before you do business internationally, you should consider these 10 points.
International business means more costs, including travel, customs, phone calls and office space if you plan to offer an overseas office. For most companies, the biggest difference in costs between having an international or domestic business is shipping. Don't forget to include the hidden costs involved with shipping overseas, such as hiring a freight forwarder and purchasing overseas shipping insurance. Further, overseas buyers might ask for long periods of credit extension, leaving you with cash flow issues unless you prepare for them. Develop a list of all the costs your international business venture will incur, and measure them against the potential gains.
Discuss the decision both with those in your business and with consultants and your industry peers. Look at other similar companies who have gone overseas and evaluate their success. Think about what makes their company different from yours.
Language and cultural barriers can be detrimental to some kind of businesses if they are not addressed. Determine if you will need to hire translators or change your website. How will you learn about business etiquette in other countries?
Consider doing a test case offering one product or service overseas. If it works well, then you might slowly start to expand.
Expanding your business internationally can be scary for both you and the person with whom you are doing business in terms of payment and delivery of goods. Consider going through an international collection service that will help the transaction run smoothly on both ends.
Solving problems in the United States is relatively easy. If the problem can't be solved with a phone call or e-mail, you simply hop on a plane and fly a few hours to meet the partner or customer in person. However, doing international business creates a whole different problem. Develop a strategy for how you will deal with problems when it is not cost-effective to handle them in person.
Customs and Boarder Operations
Whether you will be traveling, or an employee or product will be going overseas, knowing how customs and boarder operations work is integral. Understand how to pack your product for shipment overseas and learn how to make passing through customs easier for you and your employees.
If your company will have employees overseas often, you will need to determine how you can save money on things like cell phone and Internet use, lodging and meeting locations. Some airline, phone and hotel companies will give discounts to those who do frequent business overseas.
There are always hidden fees including import duties, local taxes, bank fees, and shipping fees. Talk to someone who has worked internationally to understand what hidden cost you might incur.
If you start small, trying a single product or service overseas, your losses will not be as hard to make up. However, consider how many times you are willing to try different types of international markets and how you will expand domestically if the international idea falls through.