Entering international markets. A checklist for self-diagnosis

Entering international markets. A checklist for self-diagnosis

Whether you are ready to start this process

Entering international markets. A checklist for self-diagnosis

If you are going on an expedition to the jungles of a foreign country where you have never been before, you will most likely start preparing in advance. You'll explore what you need to do, how to pack your backpack, what to carry with you. You'll buy the necessary equipment, get your health in order, train your body, get vaccinated against local diseases, save money for flights and provisions. And maybe even find a guide to help you with local customs and trails. Unfortunately, many Ukrainian companies seeking to enter global markets do this hastily, assuming that their products will be as popular abroad as they are in Ukraine. This leads to many unpleasant surprises along the way.

Dmytro Shvets, Director of Start Global and author of the Start Global Insights podcast, founder of n.cubator, told Mind how to prepare your company for export to secure its success in the international market.

One of the first steps should be to diagnose your business to understand how ready you are for this long and interesting journey. This will enable you to identify gaps and prepare better.

Point 1. Strategy

As with sales or communication strategy, export strategy is directly dependent on the company's general strategy and vision.

One of the main questions before entering international markets should be "Why?". What strategic objectives does the company's entry into international markets solve and how will it help achieve its vision? Unless global expansion is aligned with the overall strategy and prioritised, this effort usually has little chance of success.

As with any regular strategy, to achieve a desired condition, you first need to describe and understand the current situation, assess the available resources and opportunities that will help you move towards your goals.

So without a general company strategy, at least in a basic "crude" form, it's time to begin developing one.

Read also: Business during the war: what strategy to choose for adaptation and survival

Point 2. Management

This point is directly related to the preceding one. How involved is the company's management in entering foreign markets? Have they agreed to this journey and are they ready to support it by providing the necessary resources?

Very often, employees working in exports complain about management who expect to "see the colour of the money first". They are told: "Sell first, then we will supply resources for research".

This approach, unfortunately, will not work. Going abroad is a long game, and the better you prepare for this journey, the less losses you will incur in the process. After all, it can take up to one year to make the first supplies, so it is important to be committed to success for the long perspective.

Company owners and management must have a clear perception that exporting is a priority for their company. If this is not the case, it may not be worth embarking on this journey.

Point 3: His majesty marketing

Marketing is not just about printing business cards and running your social media. To what extent is this function developed in your company? What tasks does it perform? Marketing for a globally oriented company is primarily about collecting and analysing information. This is essentially business intelligence that will help you understand where the best markets are for your business, what the rules of the game are in local markets, who your customer is, what they want, and what value you can offer them.

Naturally, once this is understood, marketing's task is to synchronise with the sales function and help them communicate the value created to new customers.

Check whether your marketing materials are ready for consumption by potential customers abroad. In most cases, your client abroad will be in the B2B sector, even if your client in Ukraine is an end user. Therefore, your presentation, landing page and other materials should offer the appropriate value, selling not your product, but you as a reliable partner.

An obvious, but often overlooked, thing is the availability of relevant information on the Internet in English.

See how ready you are to quickly adapt your product packaging to new markets.

Point 4. Sales

If you did not have direct B2B sales in Ukraine and you do not have professional B2B salespeople, you will definitely need them for global markets.

This should be a person who understands how to systematically sell to other companies, knows how to plan for the long term, negotiate, identify needs, and, of course, speaks at least English, and better yet, the local language of the chosen focus markets.

Look at how well this function is synchronised with marketing, as they need to work as one well-coordinated team.

Point 5. Production

Evaluate your capacities. One of the first questions you are going to hear when negotiating with potential foreign partners is how much you are able to  produce.

You should also understand how quickly and by how much you can increase production when necessary. For service companies, your production is a resource that will provide services, a team, tools, etc. How technological is your production? How can you improve it and make it more efficient?

Point 6. Suppliers

If the value you create depends on external suppliers, you need to assess how reliable they are.

For example, many Ukrainian consumer goods manufacturing businesses were dependent on imported raw materials, which became a problem due to russia's full-scale invasion of Ukraine.

You also need to know how conscientious your suppliers are, whether they use child labour, break the law, or pollute the environment. After all, for your customer, your supplier is part of your value proposition.

Always have a Plan B, or better yet, a Plan D in case of supply disruptions. Especially now, when the risk assessment of cooperation with Ukrainian companies is very thorough, your risk mitigation plan is extremely important.

If you are counting on preferential duty rates when trading with countries with which Ukraine has signed a free trade agreement, check to what extent your product consists of Ukrainian raw materials.

Point 7. The legal part

In addition to preparing international contracts and opening foreign currency accounts, check how well your trademark and other intellectual property rights are protected.

Registration and verification of trademarks are also important to avoid infringing on the rights of other companies abroad and being sued by local lawyers. Before entering a particular market, it is worth checking for similar brands and domain names.

You also need to check the basic production quality certifications and your readiness to obtain them if necessary and at the request of foreign partners.

Point 8. Logistics

Check how ready you are to ship your products abroad. It may make sense to get contacts of professional brokers and carriers and consult with them to be prepared for this step in the future.

A basic understanding of the transportation cost and the calculation of how far it will be cost-effective to transport your goods will directly influence the choice of focus markets and the formation of a value proposition.

Point 9. Finances

Since this is a long way and requires a great deal of resources, you need to clearly understand your own financial capabilities and ways to attract additional ones.

Calculate separately what the cost of your product consists of and what are the ways to reduce it. To enter the B2B market, you will need to have a margin to pay for the services of local partners.

The availability of financial resources will directly influence the choice of a model for entering new markets, the pace and scale of promotion.

Read also: Expanding abroad: Business environment and taxation in the USA and Europe

Successful expansion into international markets requires a deep understanding of critical business aspects. Taking the time to diagnose this can be the key to export success.

This basic list is not exhaustive, as you can add your own items depending on your business and strategy. Hopefully, this simple checklist will give you an idea of what you need to focus on and what you need to improve before entering global markets.

The OpenMind authors, as a rule, are invited experts and contributors who prepare the material on request of our editors. Yet, their point of view may not coincide with that of the Mind editorial team.

However, the team is responsible for the accuracy and relevance of the opinion expressed, specifically, for fact-checking the statements and initial verification of the author.

Mind also thoroughly selects the topics and columns that can be published in the OpenMind section and processes them in line with the editorial standards.

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