In business marketing, there are many strategies. Each of them will be adapted to a specific development need. By developing an action plan and an accurate analysis, a structure can significantly increase its sales. But in addition, to convert new customers or to gain a place of choice in their field of activity. Today we’re going to focus specifically on one of these strategies: internationalization strategy, like multinationals Apple, Michelin Where Total Practice the strategy of internationalization, but what exactly do we mean by this term and how to put it into practice? I explain everything in this article.
What do we mean by internationalization?
When we talk about internationalization the mistake that is often made is to think of relocation. If these two actions can be complementary, they are still two different things: Offshoring is the act of taking your business overseas. On the other hand, the result of internationalization isExpanding your activity in the international market,
The aim of this strategy isbusiness growth By gaining new market share outside its borders. This can be done in two different ways:
- a. by operating standardization Of Offer: If the product or service is fit to be offered as in other countries.
- by developing modifications or by offering a product or service specifically designed for targeted foreign markets.
Why Internationalize Your Activity?
As your initial market growth begins to slow down, you may find yourself obliged to internationalize your activity. But the main goal of adopting this strategy is Find a new outlet To meet the demand of carriers abroad or emerging countries.
We often internationalize our activity in this logic: cost rationalization, In this specific case, internationalization may lead to the transfer of part of its activity. Labor is sometimes much less expensive in certain geographies, so outsourcing increases the profitability of some activities.
However, having some major activities in your field requires special expertise or knowledge. In this sense, factories or production chains are often concerned. Thus the risks are distributed over many geographic areas and this also means getting the opportunity to discover new growth driver straight.
As an example, we can cite the sign Sephora, Established in the beauty sector since 1969, its physical stores as well as its e-commerce sites are internationalized to more than 30 countries till date. This International Development Allows to ensure its competitiveness in the event of competition.
the gain
The main advantage of this strategy is that Diversify its cost and benefits, The fact of being present in multiple markets is beneficial: when one of these is weak, the other compensates for it. I often advise my clients, across all sectors, to increase their sources of income.
In addition, the fierce competition in some sectors prompts companies to think about globalization. By using the Internet and new technologies, organizations today find it easier to develop outside their country of origin,
Through the export of its products or services, an SME receives a real competitive advantage, It enhances its brand image and gains visibility. This makes it more reliable with its customers and with its various business partners.
Limitations
Before selecting an international establishment, you need to check several parameters. For example, note new market law which you wish to achieve. In some countries, joining forces with local partners is essential for successfully setting up a business.
Creating subsidiaries overseas is sometimes a legal headache. These strict rules can have a negative impact on profit distribution or decision making. set up to expand abroad a precise plan of your project and extensive prospecting.
Who says the process of internationalization, driven to achieve export friendly, Difficulties may be felt politically, economically, morally or technically. Remember to measure these international constraints before starting an internationalization strategy.
Most French Companies That Make Strategic Choices international trade There are big companies. They should really identify their goals and benefit from a solid structure before establishing themselves in the international markets.
How to set up an internationalization strategy?
Let us now delve deeper into the matter more precisely. Internationalization strategies will be implemented differently depending on the size and legal status of the company. you won’t be able to start yourself conquering foreign markets,
You will need to determine the internationalization of markets that fully meet global strategy of your ETI or PME-PMI. Don’t hesitate to surround yourself with professionals like a chartered accountant, tax expert or lawyer who are able to advise you on this.
You can start by betting on exports as this will not require you to adapt to foreign trade, but will require selling the surplus of your production in a new market. Easy to install and profitable, it is internationalization model most practical.
In contrast, large companies wishing to expand internationally will have to start by creating subsidiaries. The purpose of a subsidiary or branch will be to export one or more new products conquer the local market, This strategy should be the subject of an in-depth study of the host country’s expectations and needs.
put in place an internationalization strategy You will reduce the bill significantly. You will reduce production and labor costs through internationalization of activities. You will provide your business an opportunity to grow in the best quality/price ratio by diversifying its production. Furthermore, you will be able to raise the bar if the marketing of your products in the domestic market declines. But, to be successful internationally, you need to be able to identify the limits of your structure. In this sense, I strongly recommend you to seek support in this major project.