11 Steps to Setting up a Business Abroad for Success
Discover the steps to setting up a business abroad — including taking customer payments like a local — below, and launch your international expansion today
Whether you’ve conquered your domestic market or you want to become a big fish in a different pond, setting up a business abroad can be a great way to complement your existing revenue. How do you set up a business in an international market, though?
With so many different legal systems, consumer preferences, languages, and operational challenges to overcome, where and how do you get started?
We can’t set up your international business for you. Still, we’ve collated the main things you need to do to get started, regardless of your target market or business category. Read on to learn how to set up a business abroad in 11 steps.
11 steps to setting up a business abroad
Develop your business internally
Steps one through four may require some revision as you develop and position your business before expanding abroad (for example, by signing legal documents or building a website in the local language).
1. Audit your business
The first step to setting up a business abroad is to perform a SWOT analysis (strengths, weaknesses, opportunities, and threats). In simple terms, this means identifying your existing strengths, recognizing your weaknesses, understanding the potential opportunities awaiting your business in other markets, and categorizing the threats your business may face.
Your SWOT analysis can help determine your target market choice (see step two) as you discover economic pull factors in different counties. Your research should show you what you need to watch out for at early junctions (like heightened legal requirements for businesses or different currency values affecting your budget).
2. Pick a market
With an understanding of your business, pick a market to enter if you haven’t already done so. If you’ve narrowed your choice down to a small selection of potential markets, research them further or consider how you can hone your business to fit one best of all. In particular, consider the competitors you’ll face (see step three to learn how).
If you’ve found that no single market is a perfect fit, you’ll need to tweak your brand’s offering or operations to hit the ground running. For example, you may find that your existing manufacturing strategy is more costly than you’d like or that your target market responds well to digital advertising.
3. Complete a competitive analysis
So far, we’ve focused on what constitutes your business; how it’s good, what it’s vulnerable to, and why it’s unique. Setting up a business abroad means you will be up against other companies, though — so you need to pay attention to them, too.
Start by researching your direct competitors in your new foreign marketplace(s) and perform a competitive analysis to assess their strengths and weaknesses (using the same SWOT framework).
As each of you is operating within the same marketplace, you may find that there are overlaps between your opportunities (after all, that’s why you’re looking to do business there) or vulnerabilities (economic forces act on product categories as well as single companies).
If done correctly, this analysis will give you a better understanding of your USP (see step four) and a broader view of how your business will be affected if you change your strategy to resemble your competitors.
4. Summarize your USP
Once you’ve got an overview of the market ahead of you (including your competitors and customers), make a concise statement about your unique sales proposition: what makes you different from other businesses? Why should people buy from you and no one else?
Your USP statement has to be genuinely different from your competitors. It should provide value for money for your customers, which is why having this detailed understanding of your target market is vital in the first place.
Outline a plan
The next few steps involve preparation before setting up your business abroad. Namely, ensuring you’re organized and delivering a structured expansion into your new market.
5. Set goals you want to achieve
Now that you’ve got a rich understanding of your target market, infrastructure, players, and where your USP sits, outline some goals you want your business to achieve in the short-to-medium term. While your overarching goal is to make money, there are a few different ways you can accomplish this.
Given that you’re starting in a new market, you may want to lead with awareness strategies to help build brand familiarity with customers — especially if your product or service is a considerable investment for consumers. Many ways of building brand awareness depend on your budget and business or product category, so find a method that suits you.
Equally, you may wish to secure a specific portion of your business income from repeat sales (providing reliable revenue) or a threshold in total products sold (thereby indicating your market choice is sustainable for further investment). Either way, make sure your goals are realistic and achievable in the first place — otherwise, you may become distracted and discouraged.
6. Use the support around you
As you’re trying to access new markets, it’s important to remember you’re not alone. One example of the support available to your business is the US Department of Commerce’s US Commercial Service. It has individual company advice on exporting strategies, Free-Trade Zones, and tips for e-commerce brands. It is a hugely valuable resource for SMEs setting up a business abroad.
Business support packages are also available through your bank. These can help you set goals, expansion timelines, and financing methods.
7. Secure funding and create a budget
Expanding a business doesn’t have to be costly, but it will require some working capital while you front certain overheads. Look at the goals you’ve generated, list associated costs, and a catalog of necessary expenses like manufacturing equipment, software, operational overheads, shipping and warehousing, and other unique costs like translation services or consulting.
If you don’t have savings, you can apply for a business loan or secure equity financing from shareholders. Start by identifying a minimum amount you’ll need to secure to cover essential business operations (like your cost of goods and equipment, website or premises, etc.) and budget accordingly. If you can secure funding in addition to this minimum amount, allocate any excesses to high-return investments like marketing campaigns to reintroduce capital as soon as possible.
8. Create a detailed business plan
With your goals and budget ready, you can now finalize your business plan as you’ll have a feel for the limiting factors acting on your business — namely, the differing priorities of each of your goals and the underlying budget that will go towards servicing them.
Get established and get started
Our final few steps concern the practical hurdles you’ll need to overcome when setting up your business abroad — specifically, the legal and technical processes you’ll need to complete before you can start trading.
9. Establish your business legally
The local government in your target market will require some form of business registration for tax and licensing purposes. It’s essential to clear these hurdles as you could face fines or further legal trouble if you operate a business without the necessary paperwork.
Some governments may have specific requirements for heightened foreign investor transparency; others might have programs to provide your business with tax relief or grants to help you get established.
While familiarizing yourself with your new business location’s legal and tax requirements, learn how to save money using best-practice accounting and bookkeeping before tax season.
10. Set up your online presence and go live
With your paperwork and products ready, set up your online presence. Firstly, build an e-commerce website using a platform like Shopify or WooCommerce (or create your own website if you prefer), and ensure that you have translated all text into your audience’s native language. From there, use PPC, social media advertising, or SEO techniques like guest blogging to draw in site visitors.
Alternatively, you can set up a storefront on a marketplace like Amazon and use the marketplace’s native advertising platform to target new customers quickly. Overall, it’s best to use multiple advertising methods when expanding abroad as it enables you to maximize reach.
11. Track your results and perfect your strategy
Once you’ve started trading, it’s essential to track your performance. Although you’ve researched and planned, the reality of driving international expansion is different. You’ll need to know how to make quick strategic changes if you miss — or think you might miss — your goals.
To do this, you’ll need to select and measure key performance indicators (KPIs) for your business — measurements of your business’s development that show where you’ve done well or poorly. Business Intelligence (BI) tools can help you track these crucial performance metrics.
How to manage your money transfer
Have you considered how you’ll handle currency differences between you and your customers? If you’ve translated your website or product descriptions into the local language, why not go the extra mile and operate in the local currency too?
Research from Shopify found that e-commerce sites benefit from a 40% uplift in site conversions if they offer payment options in their customers’ local currency.
Therefore, finding a quick and secure method for collecting and converting multiple currencies is vital to your global expansion journey.
The Zyla Account is the hassle-free way to pay business partners and get paid from marketplaces quickly.
- Open multi-currency accounts with local account details
- Make fast and secure global payments to suppliers, staff and partners
- Collect funds from marketplace sales
- Keep costs down with competitive rates
The free-to-open Zyla Account enables businesses to make collections and payouts internationally – giving you the freedom to do business anywhere, all with the security of our online platform. Open an account today and you could be approved, set up and trading internationally in 24 hours. Get started or find out more by calling (855) 797-3366 today