If you want to grow your business to new heights, you need to expand it to market beyond your home turf. Understandably, it’s comfortable playing at your home country, you know the people, culture, language and all that and there’s probably reasonable market for many businesses to make out nice profits without all the hassle of going beyond your borders.
However, keep in mind as well that if there is a reasonable market for making profits, sooner than later some players from other countries will spot the opportunity and will want to enter your home turf. Ideally some of them want to buy your business as a means of market entry. In worst case they will become your fierce competitors. In either case, it’s always better to be in the role of conqueror than the conquered – expanding your business to other markets will give you a much bigger opportunity for big wins.
Now how to go beyond your own borders? There’s many ways to start taking your business to places. You can start setting up subsidiaries in strange countries. You can find channel partners. You can recruit sales representatives. All have their roles but going stepwise is a best approach to keep things under control. Usually the least-risk and least-effort first step is to find and sign up people or companies to act as your sales representatives. They will do the marketing of your products or services in the country, provide understanding on the local aspects, and generate qualified leads for you. But you will still be in charge of the actual sales process and closing. This is a good first step in any market as you do not have to invest much to start getting initial feel for the market for your business. Downside is that the sales representatives are rarely only working for you, so you need to have them put enough bandwidth on working with you. One way is to require minimum quota of leads they should be bringing to maintain the working relationship with you.
Second step is to sign up channel partners. These can be companies who are able to fully resell your products or services. They handle the full commercial processes locally and provide much better scalability as you do not need to be involved in each and every sale opportunity. You need to be able to train them fully on your products and services so they have the competencies to undertake the commercial activities. Also you need to provide clear commercial structure, responsibility definitions and all that. Having channel partners is a good first step for growing your business; but often the good channel partners are hard to find. Your products or services need to be attractive and scaleable enough to make the business opportunity big enough for them. Also you should always define minimum sales targets on the partnership – otherwise you will be wasting your time if they focus on sales on purely opportunistic manner.
Establishing own subsidiary is the heaviest step and should be done only when it makes sense business-wise – often for taxation reasons, but also you may want to have your “own” people close to the market to maintain local relationships and be a part of the business community. Recommended only when your business is mature enough as managing the subsidiaries can suck up a lot of bandwidth and money.
And then of course there’s the online sales channels. Your own website or webstore is the natural complement to the sales channel mix, but remember just setting up one does not open the floodgates of leads coming your way. Having one is mandatory to allow your on-the-ground partners have a place to refer to the potential customers for more information on your company and your products and services, and if your business allows it is also good to offer your products or services to be directly available through your online channel. Beware of channel conflicts, though, as you must not undermine the efforts of your partners on-the-ground.
Next time we will discuss more on the sales representative model and how to run it.