What Is Global Expansion? Everything You Need to Know

Not many good things came out for the 2020 pandemic that raced across the world. However, there is at least one and it's related to businesses going remote with their global expansion.

The number of remote jobs and workers has been expected to double in the next 5 years. With over?16 million employees?now working from home, we are starting to see just how beneficial remote work can be, for both employers and employees.

With that being said, let's take a look and talk about global expansion for both large and small businesses!

What Is Global Expansion

In a nutshell,?global expansion?is when a business goes beyond its local or national borders and begins operating in other countries. This is achieved by an international presence which can take many forms.

To break it down, this means that the business needs to either expand its workforce or open new branches in other international business marketplaces. So if your home office is in the United States and you are looking to open an office in Japan, for example, this would be considered a global expansion.

Why Expand Globally?

Here's the deal, when you grow your company and expand it globally, it has its ups and downs like everything else. However, there are definitely some major advantages that should be taken into account before deciding whether or not you want to pursue this type of strategy.

More Resources:?It gives them more control over resources. This is because they will have more options when it comes down to making decisions on what goes where (i.e., product lines)

Increased Profits:?When a business expands globally, it can often enjoy increased profits. This is because going international provides access to new markets, which in turn allows for greater economies of scale.

More Innovation:?When expanding globally, businesses often enter into new markets. This can provide a wealth of benefits, including access to new innovations and new ideas. When in a new market, businesses are exposed to different tastes and preferences, business structures, and competitive pressures. This can help businesses create something totally new and innovative.

New Talents:?When a company grows internationally, it discovers a worldwide talent pool. This adds fresh ideas, energy, and knowledge to the table. This is especially true as you deal with various and new cultures.

Target Market Vs. Home Market

When it comes down to international expansion, you have to decide if your focus will be on the home market or the target market.

The home market is where your product line was first created and sold. If you are making children's toys in Chicago, for example, the United States would likely be considered the home market. This means that there are specific tastes, preferences, customs, etc., that you must consider when coming up with new products.

On the other hand, the target market is where you are expanding to with your business.

For example, let's say that now you want to start selling your toys in Japan as well as in the United States. Japan would now become your target market because now you are trying to enter a new market with your toy business. The perceptions of the people, the customs, the culture are very different which means that you must adjust to these new factors before selling any products.

Why Businesses & Employees Love Global Expansion

Both businesses and employees love global expansion because it offers a number of great benefits. For businesses, one of the main advantages is that they don't have to pay for offices and the management of them.

This can be a huge expense, so by expanding globally, businesses can save money on this front. Additionally, businesses won't waste the time and money spent on the logistics of physical offices either.

Employees also love global expansion because it allows them to work remotely. A survey recently confirmed that?77% of people?are now expecting to work from home at least 3 days a week as of 2022. This is a huge perk, as remote work offers a number of great benefits like flexible hours, freedom from commutes, and more.

Additionally, working remotely often helps employees feel more connected to their work, which can lead to a greater sense of job accomplishment and increased productivity. When employees are happy, they often are much more productive. According to a recent study, this happiness can?increase productivity?at work by 12%.

Steps to Global Expansion

When it comes to transforming into a global business, there are a few steps to take. Each of these is important to consider and will help you determine the best route for your business and market strategy.

1) Choose Your Strategy Model

International:?This strategy focuses on exporting and importing your products while maintaining your offices in your home market.

Transnational:?This operates with the main office in one country that will then manage the local subsidiaries in the other markets.

Multi-Domestic:?This strategy involves having a completely different brand, management, and tailored experience in each market.

Global: Global strategy is when there is a single brand, idea, and product or service for all markets without change.?

2) Choose Your Market

When it comes to learning?how to expand globally, it's important to choose the right market for your business. This means adapting to local procedures, cultures, languages, and more. Each market is different, so it's important to do your research and find the one that is the best fit for your company.

3) Research & Understand Your Target Market

In order to expand globally and be successful, it's important to do your research and understand your target market. This means learning about the new customer base and their cultures. You need to understand their preferences, tastes, and customs in order to create products that they will want to buy.

4) Hiring the Right Team

Since you can't physically be in every market, it's important to hire the right people. This involves hiring employees who speak the local language, are familiar with the customs and trends, and more. This also means working with people who have remote work experience or truly want to go remote altogether.

Transforming into a Global Company

Global expansion?can be a great way for businesses to save money on office space and logistics, while also offering employees the opportunity to work remotely.

However, it's important to do your research before choosing a market, as each one is different. Additionally, you must make sure to hire the right team who are familiar with both the global business landscape and the specific target market you're looking to enter.

By following these steps, your business can successfully expand into new markets around the world. If you're ready to expand or have questions,?contact us, we'd love to help!