For business owners planning to grow their business, expanding in Europe can be a great investment. For one, you can compete with both local and international brands. You get to diversify your assets and gain a competitive edge over your competitors. You can now hire global talents and gain access to new markets.
Like all good things, business expansion can also have its drawbacks. There can be compliance risks, unpredictable costs, employee management difficulties, business operations, and cultural barriers to consider. Before you finalize your decision, there a few things you need to ask yourself. Among the crucial questions to consider are as follows.
What do you know about the business laws in Europe?
European Laws concerning local employers and foreign investors can be tricky. Of course, this is still dependent on where you plan on building your business. If you want a more business-friendly site, then you can consider Sweden and Norway. But for other parts of Europe, you will find that some French labour laws are a lot more demanding than the rest.
French President Emmanuel Macron even proposed to overhaul the complex labour laws in France. The sad reform aims to favour small business owners and investors alike. If you plan on expanding to Europe, then the first thing on your to-do list would be to do your research on local European laws.
How will you budget your European expansion?
It can be difficult to predict just how much money you need to budget for the expansion. There are many factors to research and consider, including the current exchange rate and currency, inflation rate, and interest rates. If you are to sell physical products, then there is a need to consider the costs of product distribution. Will you be using your own resources, buy lifted trucks to deliver your products, or hire a local or international courier instead?
Will you be hiring multi-lingual talents to provide better customer service to your new customers? How much will be your production and overhead costs? How much are the taxes and customs duties? Considering all these costs, doing further research and creating a budget buffer can help you create a budget enough to cover for your international expansion.
What are the habits of your target audience in Europe?
Local and international customers have different needs, habits, and behaviours. You may already be familiar with the preferences of your local clients in the US. But note that just because European customers want the same products already meant you can apply the same marketing techniques in Europe.
For your business expansion to be more successful, it is a must that you study your new customers. Consider their values, culture, language and customs. It also helps to do competitive research and see what successful brands, both local and international ones do to attract and retain clients.
It is never easy to tackle international business expansion. But if other brands can do it, then there is no reason for you to doubt your abilities in successfully making a European expansion. Of course, it will take hard work, many hours of research, a lot of brainstorming with your team, and more. Asking yourself crucial questions including the three things listed above can greatly help you in making the best decisions concerning your future business expansion.