When discussing whether to expand a business abroad, international research is an absolute must. When you start a business from scratch, it is highly likely you carried out extensive research before committing to any type of spending, model, overheads, etc. Expanding abroad is very similar to this. In many ways it’s a second blank canvas, you have the chance to completely reimagine your product/company abroad. Everything from management structure to marketing can differ. In this article, we’re going to look at why you shouldn’t be complacent when expanding abroad, and why this process needs almost as much preparation as setting up a company in the first place.
Firstly, you might know the domestic market you’re based in back to front, inside out. This shouldn’t be translated into thinking you know the same type of market abroad. Cultural, political, geographical and other key differences can all lead to the same markets in different countries acting differently from one another. There will of course be some continuities amongst some markets, yet these cannot be guaranteed upon. Also, the level of similarities will differ massively depending on which market (both in terms of product and country) you’re focusing on.
This means that your first step then when planning international expansion is spending a large amount of time and resources into international research. The idea of this research is to work out a realistic projection of how well your brand can perform overseas. This way you can mitigate the chance of those mistakes that occur when expanding overseas.
However, researching your market abroad won’t be as easy as in your domestic country. This might be due to the lack of resources at your disposal for finding the relevant information, the relevant information not being publically present, or just because of the difficulties that rise due to your company being based in another country. If this sounds like a problem you could likely come across, it can be worthwhile looking into market research companies. These companies help with research both in domestic and international markets. Their specialisation allows them to provide a deeper insight into a market than your company would be able to do by itself.
Of course, there is a cost that comes with these sorts of companies. However, when comparing costs, also consider the value of information you will be receiving. In a domestic market, there will be many tools at your disposal to provide yourself with accurate, up to date information. Abroad your options are a lot thinner. While established market research companies will have information gathering resources in these countries that can paint a much more detailed picture for you.