With the extensive focus on how the internet has divided Americans over the last two years, it’s hard to keep an eye on how it’s benefited businesses worldwide. Business is not local anymore, it’s global, and those looking to become Fortune 500 companies must expand beyond to really get ahead. Would it benefit you to consider expanding your business into the international markets? Possibly.
Here are five benefits as reported by The Business Journals that might help you decide.
1. Expanded Market Outreach.
The first benefit of expanding your business worldwide is pretty obvious: You’ll tap into new markets and increase your market outreach. Did you know that 96 percent of consumers live elsewhere? That’s what the U.S. Small Business Administration says anyway. Wouldn’t you love to tap into that 96 percent? Of course, you would, because that’s a huge addition to your customer base. Expanding abroad gives you the chance to solicit some of the 96 percent and increase your sales.
There are approximately 170 million potential new customers in Europe alone, and this is one reason why mega-corporations establish headquarters in international locations as well. Private investors also expand abroad to tap into new markets. Sjamsul Nursalim of Indonesia invested in Singapore property development to increase his $830 million net worth. A retail giant in his home country, expansion into Singapore real estate gives him additional income sources, which leads to…
2. Asset Diversification.
As with your personal finances, the more diversified your business assets the less risk you carry. Should an American facility fail, you are protected against bottom line losses with your successful facilities overseas – or vice versa. This also protects you against the volatile economy that accompanies business today. If you had a location in Turkey currently, you might find yourself in dire straits, but your location in China may more than offset the losses in Turkey’s current economic crisis.
It isn’t just about financial diversification, however. You can also diversify your products and services. One product might fail miserably in the United States but fly off the shelves in Tokyo. If you do your demographic research, you may find a market for the trinket that you simply know won’t be popular in the States. The more you can diversify your business portfolio the better, which is why many global businesses became global. International locations buffer your business from losses.
3. International Talent.
Even if you’re the proudest American there is, you must admit that there is talent throughout the world that, in some cases, will surpass the talent in the States. International labor offers some of the best people in all fields of business, and wouldn’t you love to tap into that? For example, computer technology is booming in India, and few countries can beat Japan for manufacturing. No matter what you do, you increase your ability to hire the best people when you tap into the global markets.
4. Advantage Over Competition.
When you expand into other markets and hire the best people, you automatically gain an edge over your competitors. International business allows your company to grow, and the more you expand into the rest of the world, the more customer base you control, but it isn’t just about having the most customers. You also gain an advantage in your own operating processes, because you tap into innovation and technology not available in the United States.
Imagine you are a manufacturer, for example. Wouldn’t you benefit from the technology Japan uses in its manufacturing processes? Considering it’s a leader worldwide in this industry, one could argue (and win the argument) you would. Back home in the States, customers will be impressed with your global presence. They will see a successful business here and abroad and be more likely to solicit your product or services, as a strong standing boosts consumer confidence.
5. Additional Investment Opportunities.
Remember the discussion about Sjamsul Nursalim above? By expanding into Singapore, an extremely hot real estate market currently, he took advantage of the additional investment opportunities this country had to offer. When you conduct business globally, you tap into investors abroad that might also be interested in financing your business. Some countries themselves are investors, and they offer incentives to attract U.S. business into their regions, just be careful you don’t violate U.S. tax law. Look into each incentive carefully and discuss each one with a CPA if necessary.
Expanding your business abroad opens up doors you never thought imaginable. Provided you research the expansion thoroughly and grow wisely, your business should benefit from an international market. Go slow and make certain you understand each culture included in your business expansion plan. Also, ensure you understand each nation’s business and import/export laws and regulations. Never go into another country blindly. This could create serious trouble that is best to avoid. Tap into experts in global business expansion and heed their advice. When you do so, you open your business doors to endless possibilities.