Businesses face a range of complex challenges when starting up: securing funding, building a great team, doing your homework, making sure your product or service is top quality and of course holds appeal for your customers. This process starts again when expanding into a new market, but there are ways to make sure your expansion is a success. These are our top five tips for any startup looking to expand in 2017.
1.Understand Your Market
Research, research, research. Even long-lasting success in your current market doesn’t automatically mean it will translate into your new target market. Ensuring your product is locally relevant is crucial and sometimes even small changes can make a big difference. For example, one of the reasons cited for Walmart’s lacklustre expansion into South Korea was that the retailer failed to note the differences between the American and South Korean markets, including shelf height and the presentation of fresh fish. Language also matters when it comes to your product. Don’t rule out a new name, new logo, new design if it will better appeal to your target market. After all, would you buy a coca cola if it was marketed as “Bite The Wax Tadpole”?
There are a range of great resources available designed to help your expansion succeed: your local International Promotion Agency, Chamber of Commerce as well as trade bodies in your target market. These questions are a good starting point to identify the right target market for you.
2.Know your Competitors
Visiting your target market and getting to know your competitors will also help clarify the market gap your product or service can fill. Actively compare your product with competitors: are your competitors’ prices lower? Are their products of a higher quality? What is their customer service like? How do they engage with the market? Why is your product different? Local channel partners can be helpful in getting the inside scoop but be sure to do your due diligence when entering into arrangements with local players as well. Don’t forget to protect your intellectual property when entering a new market. This list of top 20 IP considerations when entering a new market provides a good overview of how to identify your IP and what steps you need to take to protect it.
3.Learn the Regulations and Legislation Relevant to You
Different countries have different legislation and product standards which you and your products or services will need to abide by. Regulations might include corporate governance regulations, reporting requirements, tax obligations, HR legislation (hiring and firing) as well as competition and consumer protection legislation. Don’t get caught out by red tape and do your research ahead of time. The comprehensive ICAEW Country Resources Website is a great place to start your research on target market regulations and legislation.
4.Get Referrals from Current Customers & Leverage Local Talent
Even in new markets, word of mouth is a valuable reputation and brand builder. Review your existing client base for any clients who can recommend you to a new market or assist you to understand the demands of your new market (incidentally, if you aren’t doing it already, you should follow these steps to make generating referrals one of your daily habits). Having access to talent that understands the culture and the landscape of your target market will be an invaluable asset to your expansion plan.
There will always be an element of trial and error in any expansion but that doesn’t mean you must wait until everything is perfect. After all, if you wait for the moment when absolutely everything is ready you will never begin! Mitigate the risks by knowing your market, understanding what makes your product better, learning the regulations and legislation that apply to you and by capitalising on connections you have already built. The time to expand is now: do it!
Have a story to share about your experience expanding into a new market? We want to hear it.