There is an old saying about business in general, which states that if a business isn’t growing, it’s dying. One can argue that sustainable growth is more important than just growth for the sake of expansion, and they would be right.
In order to grow successfully, the expansion needs to be sustainable first. Therefore, it isn’t always necessary that a company has to choose between expansion and extinction, because unsustainable expansion has killed off more businesses than stagnancy.
Why Growth and Expansion are Not the Same Things in Business
Although similar, they are not the same concepts in business. Growth would be when a company begins to see more success in its field, learns to boost profits, and generates a bigger revenue than before, without making active attempts to expand beyond its current parameters.
Expansion, on the other hand, is what happens when the business decides to act on that growth and reinvest in itself. The idea is to spread the organization across more target zones and/or customer groups, increase their productive capacity.
Boost their marketing efforts, add new divisions and do everything else that can be done to capitalize on that growth. When done right, expansion, and growth constantly fuel each other, which is precisely what we are going to discuss next.
Know When You are Ready to Make an International Expansion
International expansion is one of the biggest steps that one can take to utilize their thriving growth, but it is crucial to know when and if you are ready to take that big step.
Failure to notice the signs in time will lead to a wasted opportunity while trying to expand at the wrong time could lead to massive losses. To know whether or not your company is ready to take that plunge into the international market, see if you can relate to the following points.
Peak Size and Market Saturation
When you know that the company has reached a point that is very close to its peak within the domestic/national market, it is time to go international. Saturation also plays a role here, because the more saturated a sector is, the faster your company will outgrow its intranational peaks.
Your Company Has the Resources to Make Use of Multiple Sales Seasons
If we take retail in the United States, for example, the Holiday season is the segment’s biggest focus every year, which pivots around Easter, Christmas, and New Year’s.
Not that retail does not experience high sales at other times of the year at all, but the Holiday season is usually the peak season for them and has been so for many decades.
The top international retailers such as Amazon and Walmart are, however, not limited by such a narrow window because it’s always the “Holiday Season” in some parts of the world or the other.
If a company presents partnerships/partnership opportunities and financial resources are capable of supporting their move towards the international retail market, they could be experiencing peak season throughout the year in some nation or another.
Market Survey Shows that Your Products/Services Have International Target Zones
In order to expand quickly, successfully, and internationally, you will need the market data to support your move. What that means is, analytics and research should show that there is indeed sufficient international demand for your goods and/or services. Furthermore, they should also be able to pinpoint the nations where they stand to benefit the most.
A New Expansion Plan Fits in Perfectly with an International Venture
An international expansion makes perfect business sense if you have been thinking about expanding into a new sector altogether, and a nation outside the US seems to have the ideal market for it.
Alternatively, maybe you invested money into a project that was successful in its own right but couldn’t find the ideal customer base in the United States. In either situation, if there is an international market that can help you usher into a new industry with greater success, it would be a waste not to give it a try.
How to Progress with the International Expansion: The Right Partnerships
By now, the idea of international business development should feel like something you can relate to quite well -that is, if you are ready for it. Take the plunge if you are ready, but don’t forget about the important pointers below if you are to have a fair chance at being successful in the venture.
Contact a Global PEO
An international professional Employer organization (PEO) would be a company that provides local companies the opportunity to expand and explore target markets outside their own respective nations.
If you wish to expand internationally, then you will need to contact a global PEO to plan the international aspects of your new business wing. Venturing rapidly into a new nation is certainly possible, but not without the help of local resources.
That is precisely what an international PEO does; they help businesses outside a nation connect with their target customers in other nations, by providing them with a local platform to do so.
GlobalPEO is equipped to handle everything from payroll management, Human Resources, and international recruitment to local compliance factors such as managing the necessary licensing needs.
Handling and paying taxes, and taking care of all other legal compliance factors, as is applicable in the target nation/nations. For companies looking to launch a multinational expansion, GlobalPEOacts is a one-stop solution, given that, unlike other PEO agencies, they are not limited to specific geographical regions only.
The company has resources in 160+ countries across all sections of the globe, making them ideal for any and all international extensions, irrespective of the client’s target area or the number of target countries.
Keep It Small Initially and Find the Hottest Target Zones
Data from business analytics and market surveys should be able to show you hotspots around the world on a geographical map. Once you have already decided in favor of the international extensions, it is time to act with both speed and wisdom.
Don’t just rely on on-demand data because market saturation is an often-neglected aspect to consider as well. For example, China is the world’s largest smartphone consumer.
But Xiaomi has found more success outside China, and they are currently the top smartphone OEM in the country. Given that India holds the second position after China as the world’s largest smartphone consumer nation, Xiaomi’s international expansion paid off dividends by the billions.
If given a choice between a highly saturated but in-demand market and a less saturated market with moderate demand, choose the latter. Further expansions can always be made. But it is better to build a brand name for yourself in a less competitive environment first, before diving headlong into an extremely competitive one right away.
Even as you gain footing into the less saturated nation, marketing efforts to prepare the next big hotspot for your company’s arrival should be ongoing and constant.
This is a good strategy that allows for sustainable and quick international growth with a high success rate, rather than rapid growth without proper planning to give the expansions the frames they need to succeed.
Remember that the local employees and partners will also be dependent on the way you conduct your business from this point onward.