Should Our Company Expand Overseas?

Deciding whether or not to expand your business overseas isn’t a decision you should take lightly.

However, a lot of thought about the potential pros and cons of going global can help you decide if expanding overseas is likely to skyrocket your profit or leave you bankrupt.

Pro - Use the Internet to Expand

One of the main benefits of expanding abroad in today’s world is that you don’t have to physically relocate. Instead, you can use the internet to offer your goods and services abroad.

Using the internet to reach a global market is a great way to test the waters. You can see if your goods and services are in demand in other parts of the world without investing a lot of money.

Pro - Reach Many More customers

The obvious main benefit of expanding your business overseas is that you can reach a much larger audience. About 95 percent of the world’s population lives outside of the United States. Expanding overseas can greatly increase your pool of potential customers.

Con - Language Barrier

One major issue with expanding overseas is the language barrier. If you don’t speak the same language as your potential customers, selling your products and services will be difficult.

Almost every part about running a business becomes complicated when there is a language barrier. Everything from setting up the business to marketing your business requires a translator.

Hiring translation services can be expensive. Also, your ideas or information can get lost in translation. For example, if you’re trying to introduce a new product overseas and they don’t have word in their language for such a product, it can be nearly impossible to communicate what you mean.

Con - Unfamiliar Laws

Every country has its own rules about real estate, taxes and businesses. It can be intimidating to learn about foreign business practices.

If you plan to expand your business to several different countries, it can feel overwhelming to try and ensure you are following each country’s rules and laws.

Other countries have different laws about things such as intellectual property and trademarks. Therefore, it can be daunting to protect your rights in other countries where your trademark isn’t honored or where you don’t have the same intellectual property rights.

Con - Cultural Differences

Cultural differences can also pose a barrier when it comes to expanding overseas. There may not be the same need for your product or service in other countries.

Also, marketing practices need to be culturally sensitive. What works in the United States to sell your product may not work in another country. In fact, it may be offensive to people in other countries.

Con - Takes a Lot of Work and Money

It takes a lot of work to expand your business overseas. The research alone can take years.

Often it makes sense to hire a group of professionals to help you expand overseas. Hiring a liaison with each country can help you obtain the necessary information and documentation to begin expanding your business.

Despite the cons of expanding overseas, it can be a worthwhile effort for many small businesses. It can greatly increase profit while reaching a mass market.