The perks of BPO for international market entry
Business Process Outsourcing (BPO) helps emerging businesses enter international markets affordably.
Medium enterprises can enter global markets using diverse methods.
BPO is critical in a company’s foreign entry strategy.
Businesses seeking international expansion should ask and answer various strategic questions.
Did you know that BPO can help you conquer global markets? Entering these markets requires keen consideration and the correct partnerships to help you survive, compete, and thrive abroad. So, how does BPO come into the picture? For one, it helps you build an international team. We examine how BPO service providers can assist your entry strategy and the critical questions you should ask before going global.
Strategic questions to ask before entering international markets
Venturing into global markets is challenging and equally rewarding if you know how to proceed. You must ask and answer critical questions before getting started. This section discusses the essential entry questions to ask.
1. Where do I start my global foray?
The “where” question is essential to your entry game plan. The reason is that different countries have unique business opportunities, challenges, market potential, and threats. Thus, ensure that your chosen nation has sufficient market potential to consume your services and products.
A foreign country’s labor and production costs, tax implications, and business regulations should be at your game plan’s center. So, evaluate the list of countries that best fit these criteria. Afterward, choose the best country that fits your business’s international entry plan and capacity.
2. When should I enter international markets?
Timing is essential, so be careful to enter the market at the most appropriate time. This question presents two options where you can either choose to be the proverbial early bird or a latecomer. Being an early bird could challenge your strategy because of the following uncertainties.
Your desired local collaborators might hesitate to sell your product if it’s new because they’re unsure of its success.
This option might be costly if you choose the wrong entry strategy.
You aren’t sure that your products or services will succeed in that foreign market.
Alternatively, you could choose to wait and see how your competitors perform in that country. This alternative is equally challenging because your pioneering competitors will have already entrenched themselves in the market. Thus, you will have a tall order trying to play catchup.
3. How do I enter foreign markets?
You must prioritize your entry method. Otherwise, your entire plan could backfire. Be careful to choose the most appropriate entry method that aligns with your strategy. For instance, it should favor your technological, financial, and human resource capacity. Don’t forget to factor in your medium and short-term expansion plan in those foreign markets. Below are the leading market entry methods.
Export is ideal for manufacturing businesses. BPO comes in handy to help expanding companies find new suppliers and customers. It also helps them access cost-reducing routes, favorable logistics, and friendly tax conditions.
Fully owned subsidiary
This entry option involves buying another company in a foreign country. Your business can continue operating the subsidiary as before or as per your preferred way.
Foreign direct investment
This option lets you invest directly in facilities in another country. You need capital to hire new staff, buy relevant tech, and get operational premises. Also, you might decide to buy an existing business or start from scratch.
You may also franchise local enterprises to manufacture goods as per your standards. Franchising allows you to sell your intellectual property rights to existing or new local ventures.
Here, you collaborate with a local company and jointly own a new business venture. The ownership arrangement gives you joint control of the new business entity. Its biggest benefit is that your foreign partner is a local who understands the “ground” better and is entrenched there. Its main challenge is trust, especially when sharing and investing profits.
Therefore, choose your partner carefully to ensure you share values. It’s also essential to discuss and agree on potentially divisive matters before signing on the dotted line.
Lastly, you may enter global markets through licensing. This entry alternative allows a foreign business to use your properties at an agreed fee. The properties here could be patents, unique manufacturing techniques, or trademarks. This entry option is one of the least expensive and provides a high ROI.
4. Which is the ideal entry scale?
Lastly, address scale matters because starting too small or too large could bungle your plan due to cost implications. Ensure your current financial muscles allow you to enter a foreign market at the right level. It’s prudent to enter in small manageable bits to avoid taking too much risk at once.
Entering small and scaling from there also allows you to learn the new market hands-on. You can easily make necessary adjustments to avoid unnecessary risks. Don’t forget that the ancient scribes advised us not to test the river’s depth with our two legs. Don’t invest too much at a go in a new market until you’re sure how it will respond to your products or services.
Strategic entry planning: How does BPO help?
Your entry strategy into an international market determines your success potential. Choose your entry strategy carefully because it helps you detect potential challenges, risks, and costs. Ideally, it should address five crucial success components.
Partnering with a BPO company comes in handy at this time. Below are five critical areas and how BPO helps you succeed in them.
Your plan should factor in all of the essential technological and human resources for your new foray. A BPO firm can help you with your staffing resources by outsourcing hiring processes affordably. These companies also allow you to access their technological platforms at a minimal cost.
Products or services
Your strategy should determine if you will sell products or services. ABPO company will help you with your marketing and sales efforts.
Competitiveness is vital in your business’s foreign market entry. Teaming up with a BPO firm improves your business’s competitiveness by offering process optimization, modern tech infrastructure, and labor savings.
Your expansion strategy should also address risk mitigation. A BPO company can mitigate your cyber risks by hosting your servers securely away from cybercriminals.
Allow room for flexibility in your entry plan. Fortunately, BPO enables you to remain flexible in many areas to promote your growth. Their contracts are easy to modify to accommodate your dynamic market needs.
Let Doxa7 help you conquer international markets
It only makes sense for medium-sized enterprises to want to expand into foreign markets. After answering some critical pre-entry questions like those listed above, BPO can assist with your scaling by offering several resources, risk mitigation, a competitive advantage, and more.
Are you ready to take your business to new frontiers? Our team of entrepreneurs will guide the international market entry process and help you thrive in global markets. Take the first step and contact us today for more information.