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Thinking About Going Global?

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Thinking About Going Global?
CONSIDER THESE FOUR THINGS BEFORE YOU DECIDE
By Doug Kramer

International markets represent a wealth of opportunity for Texas businesses looking to expand revenue
streams. However, growing the footprint of a business outside of the United States comes with serious
challenges. Fortunately, whether an organization provides goods or services to its customers, many of
the considerations for going global will be the same. These four keys form the necessary baseline for
planning an expansion beyond U.S. soil.

Global Demand
Before pursuing markets outside of the U.S., it is important to understand current demand for products or
services intended for export, and to identify growth potential. This potential may be based on (or limited
by) a number of elements such as pricing, technology, innovation, competition, population and the
maturity and general acceptance of the product or service to be provided in the global market. These
analyses may be available through industry organizations and other market research firms, but it is likely
best to seek answers from known and knowledgeable industry contacts with experience in the markets of
interest.

Competitiveness
It is essential to identify the organization’s potential to be competitive in international markets where
demand exists. Remember, demand alone does not represent opportunity. There are other important
variables that must align with demand for a global expansion to make sense. For example, one
consideration specific to goods-based businesses is the amount of freight and import duties assigned in
the target expansion regions. It’s imperative to understand the impact of these duties and their influence
on the cost structure of the company’s sales model.

Evaluating the true impact of duties and other costs requires a number of examinations, including the
feasibility of the business model to turn profit in markets where demand exists, the ability of the
organization to compete against alternative providers in those same markets and the likelihood of the
business to accrue market share.

Reliable, Local Partnerships
After global demand and competitive potential, a local partner should be the next key consideration. The
benefits of a partner with boots on the ground include an increased likelihood of buy-in from foreign
customers, inside cultural knowledge and minimization of the inherent risk of conducting business outside
the organization and its personnel’s home region.

Despite all its benefits, local partnership still brings another party to the table, which means it’s imperative
to find a trustworthy partner with whom to build a strong relationship. When vetting potential partners,
make sure they are not only experts in the industry and members of the regional business community, but
that they are respected business people. The right partner should speak the local language and possess a
deep level of cultural and customary knowledge — specifically pertaining to business. This cultural
knowledge will prove essential for the organization in all negotiations, contracts and business
development initiatives.

The right partner should also be able to provide access to channels in the market and represent the
company’s values and brand in the local region — all while maintaining the reputation of a true “local”
among potential clients and customers.

Don’t leave the partner relationship to chance. Invest in training partners to ensure they fully understand
the brand, corporate values and growth goals. In much the same way a local partner learns from training,
company leadership should invest in learning as much from its local partner as possible.

Marketing 101: One Size Does Not Fit All
As all marketers know, one size doesn’t fit all, and adapting the company’s marketing strategy for
international audiences is another primary consideration for taking a business global. As a domestic
marketing strategy must align with its intended target audience, so must an international marketing
campaign.

First, make sure all marketing is culturally appropriate, utilizing the local language, dialect and
nomenclatures, and ensuring the messages both incorporate and address regional expectations for the
industry. Employ imagery and graphics that speak to the local culture and belief system, and pay
attention to the smallest detail. For example, even measurements, which may seem like minutiae, should
be presented in the local measurement system. And finally, use the local marketing channels, which will
likely differ from the ones the company’s domestic audience uses. Just like at home, it’s important to
identify the correct channels — otherwise, even the most perfect marketing will go unseen.

Does Everything Align? Go for It.
If all of these considerations align — global demand and regional competitiveness are established, a
trustworthy and well-respected regional partner can be identified, and there is a firm grasp on culturally
appropriate international marketing across the right channels — the baseline essentials for a successful
global expansion have been established. In addition to eliminating unnecessary risk, this foundation will
provide a path to additional avenues for increasing profitability, competitiveness, market share and the
rewards of a global business.

Doug Kramer is President and CEO of Houston-based Lapolla Industries, a spray foam and coatings manufacturer. In 2010, he led the global expansion of the company and Lapolla’s products are now distributed in over 40 countries.