Let’s say you have a business and it’s doing really well. At some point, you may start to wonder, what’s next? Expand internationally? But is it really beneficial to expand your business into an overseas market?

Benefits of overseas business expansion

Written by Adrian Williams

Let’s say you have a business and it’s doing really well.  At some point, you may start to wonder, what’s next? Expand internationally? But is it really beneficial to expand your business into an overseas market?

There are a number of perks that your business may experience when opening up your offerings internationally. In this episode, we’ll focus more on the development of products and goods. Here are Five Key Benefits of expanding abroad.

1. Increase in Revenue Potential

When your growth opportunities have become exhausted at home, turning to overseas expansion can help to grow your business. Tapping into a new territory allows you to explore new markets and opens up your customer base, hence, increasing your overall sales. Just to be clear, tapping into a new territory could mean either exporting your products or also the physical set up of additional branches or stores.  At the preliminary stage, you will need to ensure that you have a long-term financial plan. If you do not have the capital, then seeking investors or financing becomes key.  If you want to expand internationally, you need to be in it for the long haul.

2. Diversification

Having your business within the home market will limit your potential for profit. A downside to operating in one country is that you are easily threatened by market changes. When you have expanded to the global market, these changes will be cushioned by the diversification of your markets, making your revenue more stable.  

3. Competitive advantage

Now it may also be that your current market is saturated, meaning that there are many competitors offering the same or similar goods or services as you do within the same territory. So if you can find a new market with less competition, where your product or service is unique, you may be able to gain a competitive advantage. A key part of planning is to begin having talks and fostering a connection with persons or companies in the market you’re interested in. And don’t think small when doing this.  Search everywhere and build your network. This step along with getting into a territory before your competitors do will give you a competitive advantage. Getting into a space where your competition does not operate gives you a better chance at securing the bag!

4. Cost saving

By setting up in a new region, you may realise that operational costs can be much less. You may be thinking that adding another location or more locations would mean spending more money right? Well, some aspects may involve more spending which is why it is important to have your capital investors on board to start up. But you may be able to save on things like labour, rental, and electricity, if these costs are lower in the new territory than they are in your existing one.

5. Improve your company’s reputation

Because now you’re a big shot, you’ve gone global! A good global reputation can attract new customers. Extending your reach internationally gives room to build brand recognition and reliability with the product or products you have to offer. 

Expanding your business overseas takes a lot of calculated risks but as long as you do the background work, the benefits are yours for the taking.

Categories: MoneyMondaysJA