How does international expansion provide companies with a competitive advantage?

Bharat Nangia

Bharat Nangia

Extended Arm | Tech Solutions | DTM | Mentor | Hong Kong |

Published Jul 31, 2020

People don't know what's best for them. 

Why am I saying this? 

Well, I am saying this because people are uncomfortable with doing what they have to do.

They don't want to come out of their shells and grow. They think they are happy and growing wherever they are. But that's not the truth. 

But why am I saying all of this?

It is because people ask me or sometimes even oppose to EXPAND their businesses. 

This confuses me a lot. Why is it that they don't want to grow. 

There are many advantages when it comes to expanding the business. With more customers to better leads, you won't have anything to worry about. 

But that's not all. 

Let's get into this article and see what else are the benefits of expanding.

1. Improving Profit Margin - We all do business to get profits. Isn't it? When you have achieved the desired profit goals in the national markets, the next logical step is to seek international growth. Your customer base increases once you start selling your products in global markets. And once you offer compelling solutions, your revenues will grow quickly. The international expansion comes with some cost-savings as well. Your company can reduce costs by relocating closer to a supplier or benefit from lower production costs by expanding operations to another country. Further, a lower cost of acquiring customers may be another compelling reason to expand internationally.
2. Gaining a Competitive Advantage - If your goal is to outpace your competition, you need to consider international expansion. In fact, 56% of middle-market companies include global expansion into their growth strategies. Taking your business international presents growth opportunities by expanding options for talent, customers, and creating cost-savings for imports and manufacturing.
3. Accessing Global Talent Pool - Hiring a skilled person for the job is crucial for anyone - whether you are a startup or a 50-year-old enterprise. But accessing the talent pool nationally might not be enough for you. You need diversified people who can speak different languages. Hiring global employees can provide unique insights into local cultural norms. Additionally, many workers from emerging markets may be less expensive than workers from Western countries.
4. Find New Customers - When you have been working in one market for quite a long time, it gets difficult to get new customers. And if you don't have new customers, it will be hard to scale your business. Global expansion will help you get a new customer base who have never seen your product before. It gives you an opportunity to create excitement and curiosity in the mind of people for your product. 
5. Utilize Government Incentives - Change is hard, I agree. International expansion is all the more daunting. But if you have support from the government, the entire process will become easy. Many governments all over the world offer incentives to promote trade and business in their countries. A lowered tax deduction is one of the best incentives a company can get. 

The above reasons are the great benefits your company can get to when you think of expanding globally. Once your team is aligned on your global initiatives, you are ready to start developing a strategic plan. And if you need help in making those strategies, drop a message.