If your company has a website, it’s virtually assured to reach prospective customers beyond the borders of its domicile. You don’t have to be a rocket scientist to see the potential in a cross-border business strategy.
Of course, imagining your business as a global powerhouse—or even a global dabbler—isn’t the same as actually building a global brand. Whether you’re based in a huge country with a massive domestic consumer base or a smaller state where competition is fierce, selling across international lines is no sure thing.
“Doing business internationally requires a formidable set of skills and competencies,” says Fergus Cleaver, a New Zealand-based accountant who works with closely held firms. “You don’t simply wake up one day and say, ‘I’m going to open a shop in Singapore today.’”
No matter their professional goals or the industries in which they operate, the best international businesspeople tend to have these 10 key traits. You don’t have to pass each of these tests with flying colors, but it certainly doesn’t hurt to have someone on your team who checks each box.
1. Planning Chops
Businesspeople used to doing business in a single market sometimes underestimate the complexity and multidimensional nature of international expansion. Many of the potential pitfalls can be overcome with careful planning—something that’s too often missing from international business plans.
“Talented, ambitious entrepreneurs are frequently stymied by lack of planning,” says Cleaver. “Over-preparation never hurt anyone.”
If you’re not a detail-oriented leader, surround yourself with people who are, and then task them with developing an effective plan for the next stage of your company’s journey.
2. Relationships With Local Distributors and Fixers
In some parts of the world, you can do cross-border business with the same set of distributors and local contacts. The European Union’s single market is a prime example.
In other parts of the world, each country requires an entirely new (or nearly so) set of distributors and fixers. Before you expand into a new market, identify and vet prospective partners, always with an eye to quality and cost. If possible, hire local employees with existing, potentially beneficial relationships.
3. Local Knowledge
To effectively do business in a new market, you need to understand how the local economy works. More to the point, you need to know whether there’s enough local demand for your products or services to make the expansion worthwhile. History is littered with examples of disastrous international miscalculations—Target’s failed Canadian expansion, for instance.
4. On-the-Ground Support
Local support follows from local knowledge. Assuming there’s a real market for your products in your target country, you’ll need to provide real, tangible support to your customers there. This is particularly crucial at the outset, as negative word of mouth from early adopters can completely derail whatever momentum you’ve built.
Your local support infrastructure should include in-country professionals who speak the local language and understand the local customs. If money is tight, a regional office is fine, but you need to be prepared to handle returns or conduct face-to-face meetings anywhere you do business.
5. Willingness to Think Outside the Box
This is most definitely a “soft” skill, but that doesn’t make it any less important to your international business endeavors. As you receive feedback from your first customers in each new market, you’ll likely tweak your offerings there to better reflect your audience. And that requires a willingness to think outside the box, especially if you’re not an expert on the local customs in each country. Or, if you’re more of a numbers person, it requires new hires willing to go out on a limb.
6. Language Skills
English might be the unofficial language of international business, but don’t tell your international customers. Before you expand into countries where English is not the official or de facto language, make sure you have local language expertise in-house. You don’t need a kerfuffle over a misprinted label or unintentionally rude sales staff to derail your global ambitions.
7. Legal Guidance
It turns out that sovereign countries get to make their own laws. Some countries’ laws are quite business-friendly; others are challenging, to put it mildly. It pays to know which are which, and to have on-call international attorneys—if not necessarily country-specific counsel—to advise on potentially thorny legal questions.
8. Room for Growth
Going international is exciting. It means your business is primed for growth. But in order to capitalize on your company’s potential, you need to be ready to grow. That’s not always an easy reach for small, closely held companies. If you’re serious about embracing the promise of a push into international territories, you need to design and develop a growth strategy ahead of time—and put the key prongs of that strategy, including a hiring manager or department, into place long before you market your first product overseas.
9. Cultural Sensitivity
Years ago, New York Times columnist Thomas Friedman made waves (and millions for himself) with his seminal pop-economics volume, The World Is Flat. In it, he argued that it’s easier and less culturally challenging to do business across international lines than it has ever been. In the intervening years, that has only gotten more true.
But doing business in foreign lands isn’t exactly—or even approximately—like doing business around the corner. Every country’s business culture is different. In places with unfamiliar customs, you must do your homework and be prepared to allow your local prospects to lead. The last thing you need is a deal scuttled over a miscommunication or faux pas that you didn’t even know was happening.
10. Patience—Lots of It
Patience matters too. In many countries, business moves at a relative snail’s pace. Deals aren’t inked on the first encounter—they’re allowed to blossom and develop over the course of months or even years before any ink is spilled. If you’re not used to high-touch wooing, you could be in for a surprise when you approach your first overseas prospects.
Are you planning to go global? What are you doing to increase your chances of success?