Get in the know
But before you make any expansion decisions, arm yourself with knowledge. The insights and tips inside the KPMG Enterprise Going global guide make it a pretty good place to start.
It will help you address three fundamental questions: “where?”, “why?” and “how?”.
“Most retail businesses have spent a disproportionate amount of time on the ‘where?’, even though it is the easiest question to answer,” argues Paul. “In fact, it’s understanding the ‘why?’ that is mission-critical.”
The quest for growth is what typically drives internationalisation. The UK retail market is large but saturated and British brands do appeal to a global audience. So far, so obvious. But what specifically is driving your decision to expand? And what is your plan for growth? For example, will you choose a franchise model?
Consider whether you want to trade as a UK business with some international operations, or be truly international. While the two things sound similar, they’re not. And the option that you go for has significant ramifications when you come to address “how?”.
This question has two components. The first concerns the business model. Will you expand via acquisition? Or will you enter a market in a joint venture? There may be significant advantages to the latter. However, success hinges on choosing the right partner, and due diligence will be critical. Another option is third-party ecommerce platforms like Amazon, or China’s Tmall.
The second issue when asking yourself “how?” revolves around the implications for your operating model. Will you run marketing campaigns, pricing strategies and product sourcing from HQ or from your overseas office? If you decide to run product sourcing centrally, for example, you must ensure you are still attuned to consumer tastes and habits local to your new overseas market. Did you know, for instance, that Chinese people will not wear black at a certain time of year due to its cultural association with death?