Although it’s mid February, you’ve still got almost all of 2019 ahead of you. So you’re probably still pretty fired up on making your dream of world domination happen this year. No, really! What if going global is your dream this year?
Technology, yes, that same tech that allows you to sell to folks all over the country, means you can turn the whole world, or at least various parts of it, into your marketing oyster – just ripe for the shucking (sorry, couldn’t resist that pun).
If done right, you can hit some very real goals. If done wrong, however, you might burn through some serious cash and put your business’ liquidity at risk.
Therefore it’s important to;
- understand the challenges of going global
- get your planning and implementation sorted before going global
What are the challenges of going global?
Expanding your online business to much broader markets might not be as easy as it sounds and there are many challenges to ensure you’re across, before you leap. These include:
Customers are demanding and critical more than ever – they want what they want and they want it now – preferably at a very competitive price. Of course, if you’re a monopoly or very niche supplier of say, knitted Persian cat hair jumpers, you’re likely to have a better time of it price setting-wise.
One of the issues that few etailers consider especially when first setting up are the costs associated with returns, which can run to as high as 30%. But, when you factor international returns into that, let’s just say, that’s something you need to both consider AND work out.
Research has shown that around only 66% of Australian online businesses cater to international markets as compared to 88% of businesses in Hong Kong and Singapore. Many of the firms that took part in the research mentioned that government tariffs and regulatory issues prevented them from expanding their businesses and going global.
So that’s definitely something for you to add into your mix. Make sure you do your research first. The last thing you want to end up with is a huge import tariff being added to your customer’s bill when they pick up (or billed back to you AFTER you’ve dispatched a couple of hundred parcels).
Increased demand for delivery speed, product life spans, government regulations and pick and pack customisations have made logistics complex. If your ebusiness wants to target international markets, you have to consider your infrastructure for transportation and delivery in your target locations. You have to build a solid partnership with your preferred 3PL logistics firms. You’ll want to consider who’s where, what they offer and speed of delivery.
Risks of talent shortfall, market volatility and disruption
If your business is considering going global, you’ll have to manage in market talent acquisition and retention. Why? You’ll need to think about what the market needs in terms of not only product, but also marketing methods, look and feel, and possibly advertising partnerships, influencers, etc – all of which are much easier when you’ve got someone on the ground.
You’re also likely to be exposed to market volatilities you’re less likely to experience here. This might include factoring in currency loss, staff and delivery time loss due to acts of god (floods, earthquakes, volcano eruptions), government changes, changes of legislation, war – civil or otherwise or something far more likely, but no less difficult, such as difficult and unreliable internet services, etc.
Of course when it comes to logistics and 3PL considerations for going global, that’s where we can help. If you’d like to chat about what’s possible in expanding your business, we’d love to talk. You can always give us a call on +61 2 9828 0111 (Sydney), +61 3 9240 6300 (Melbourne) or +64 9 263 8855 (Auckland) or drop us a note via the form below. Alternatively, you can find a full list of available services here.