For a small business, expanding internationally has plenty of advantages. It’s a good way to grow faster, extend the sales life of your products, and diversify revenue sources to reduce dependence on a single market, just to name a few.
How do you get started building a global small business? Our one-word answer is research. In this article we’ll focus on this all-important first step to expanding internationally.
You’ll need to do research to decide which markets to enter. Foreign market research is similar in many ways to the kind of market research you probably did to launch your business in the U.S.—learning the competitive landscape, the target audience, the distribution channels, etc. But it’s more expansive, because this time around you don’t already know which market you’re going to target. So you also need to research things like the economies and cultures of your prospective markets. (More on culture later.)
Sounds like a tall order. And it is a lot of work. But for a global small business to succeed, no step is more important.
Fortunately, there’s plenty of help. The U.S. Commercial Service (USCS) hosts a website, export.gov, with lots of super useful information and services. The market intelligence section of the organization’s website is an absolute goldmine of information you can access for free that will help you in your foreign market research. For a fee that’s very affordable for a small business, they can conduct an initial market check, an assessment of your product or service and its potential for success in a particular foreign market. They’ll even do custom research for you at an hourly rate.
Once you’ve chosen your target market(s), you’ll need to learn how to take your global business —and become intimately familiar with their commerce laws and regulations. You’ll need to know the relevant U.S. regulations too.
There’s a thing called a Schedule B code, which is a code used in the U.S. to categorize your product. You can look it up using the Schedule B Search Engine. A subset of your Schedule B code is a 6-digit HS code, which is an international code for your product’s category. It’s useful to know your product’s Schedule B/HS code because you’ll use it to learn about things like tariffs and preparing shipping documents for your specific product.
To help guide you through the regulatory landscape, consider enlisting the services of an international business consultant until you learn the ropes. Customs brokers are also a valuable resource.
Of course, every market has its own culture and its own social norms. So you’ll need to research those too. Any marketing you do, including and especially your product packaging, needs to not only comply with regulatory requirements, but also appeal to the culture of your target market.
Again, the export.gov site is a go-to for this research, with profiles for specific markets. Another terrific resource is the American Chambers of Commerce Abroad (AmChams). The U.S. Chamber of Commerce website hosts an online directory of these chambers, which you can search by your target market or a keyword.
Consider this: Some 95 percent of consumers live outside our nation’s borders.1 And it’s never been easier to do business internationally. Don’t think for a minute that just because your business is small, expanding internationally isn't an option. In fact, if you do your homework, you can successfully expand your small business into foreign markets, too.
1https://www.uschamber.com/ad/95-worlds-consumers-live-outside-united-states