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Five reasons to hire a consultant when expanding overseas
By Stephen D. McLaughlin
Posted August 30, 2006

With very few exceptions, no matter what business you are in, there is a market for what you have to offer overseas. You never thought that your product could make it in Belgium, or Great Britain, Germany or the Ukraine? It might be time for you to think again – because virtually everything your American customers are interested in buying from you, customers overseas are going to be interested in buying from you as well. Each year the world moves closer to a truly global economy. You only need to read reports of McDonalds’ success in Mainland China or Walmart’s wins in India to understand that while cultures and traditions might differ, what people want and are willing to pay for remains virtually the same across the globe. 

But it isn’t just the multi-national giants with billions of dollars to spend on market research that are successfully expanding their operations overseas. Every year, more and more small and midsize companies are finding amazing profits can be made outside of the United States. These are companies with the vision to see beyond their own borders, and the willingness to devote the energy and work necessary to make their expansion pay off. In most cases, they are also companies that understand that doing business overseas is not the same as doing business in Iowa or Oregon. 

I can’t tell you the number of American businesses I have seen flounder and fail in their overseas expansions simply because they didn’t adequately understand and prepare for what they were getting into. In some cases, these failures were due to not understanding their markets or their partners’ needs; while in other cases something as simple as an inability to communicate effectively on all levels was the cause. In virtually all of these cases, failure could have been turned into success if they had only hired a qualified consultant to help them with their expansion. 

Here are five fairly common problems that a qualified consultant can help you avoid when you are expanding your business overseas.

      TALKING TO YOUR PARTNERS I am continually amazed by how many Americans both in and out of the business world assume that everyone in business overseas speaks English. While it is true that the majority of the world leads the United States in multi-lingual citizens, the simple fact of the matter is that not everyone you are going to need to deal with in your expansion is going to understand everything you say. Whether it is on the production end, or IT, sales or service, in order to convey both generalities and those all important nuances that are taken for granted between English speakers you will need reliable translators working for you – at all levels. A qualified consultant will be able to help you build a professional translation team that not only understands the language, but is also familiar with the particular nuances of your specific business.

      UNDERSTANDING YOUR MARKET – One of the main misconceptions I run into with my clients – and see in the way other companies position their expansions – can be summed up in four little words: They’re Just Like Us. Regardless of where you are expanding your business to – and who “they” are – the odds are very good that they are not just like you! As a result of the myriad of differences that exist between cultures, histories and basic sociological trends within the different nations in the world market, different things are going to be more or less important to your customers based on who and where they are. As an example – for the vast majority of your customers in the United States, price is the overriding factor when it comes to purchasing one product over another. This, however, is not the case in Brazil, or The Netherlands, or Singapore where quality is the touchstone upon which a sale is made or lost. Introducing a product in these – and dozens of other global markets – that sacrifices quality for price is an enterprise doomed to fail. A qualified consult is critical to helping you identify and service the specific needs of your international target markets.

      GETTING YOUR MACHINES TO TALK – The Information Technology explosion of the last 20 years is, in a very real sense, perhaps the principle reason why small and midsize businesses are now able to expand their operations overseas successfully. However, setting up a common operating platform with your overseas partners is not the same as setting up a shared network with your branch office in Milwaukee. If it is not done right the first time a flawed overseas network can have many costly – and potentially disastrous – consequences. As an example, we have found that the German language tests the limits of many software programs commonly used by U.S. based businesses to the point where their effectiveness is seriously compromised, making efficient communication all but impossible. A qualified consultant will be able to assemble a team of top IT professionals familiar both with your specific business and the various interface problems that can be expected between you and your partner, ensuring that an operational platform is up and running when you need it. 

      STAFFING YOUR EXPANSION Staffing your foreign office with qualified professionals at every level can be among the most challenging aspects you will face in your overseas expansion. Not only are there language and cultural issues to keep in mind, there is actually locating the right people for the positions you need to fill. This is a particular tricky issue when staffing an office in Europe, where the privacy laws are such that finding even basic information about applicants can be virtually impossible unless you know exactly where to look. Most importantly, it is critical that you find people who not only know their jobs but also understand the way we do business and are comfortable with interacting with Americans. A qualified consultant will have both the understanding of the various cultures involved and the necessary contacts to save you time, money and angst by finding the right, qualified personnel for every overseas position you need to fill. 

      EXPANDING YOUR EXPANSION – Now that you have successfully made your expansion overseas and are up and running profitably, your work is not over. As a matter of fact, it has just begun. Having established your company’s presence, it is time to start looking for ways to increase your sales and, thereby, your profits. One of the most effective ways to do this is to be able to both spot and position yourself to take advantage of the various trends that come and go in every conceivable facet of the global marketplace. This is where your qualified consultant can prove invaluable. Because their business is keeping abreast of what is happening in the international economy, your consultant will be able to keep you informed on the latest trends in your industry while pointing you towards new, broader potential markets within your current – or future – expansion area. 

There is a certain element of risk involved any time any company decides to expand its operations, and this risk is compounded when that expansion takes place overseas. The key to successfully expanding overseas – and minimizing your risk – is to make sure that you take advantage of all the tools that you have at your disposal. While the above five examples are certainly nowhere near everything a qualified consultant can do to ease your transition into new foreign markets, they do show what an important tool having someone who knows their way around the global economy is. The money they can save you – and in increased profits they can help you earn – will go a long way to funding your next expansion!

If you want to learn more about Steve McLaughlin click here

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