What to consider when sending a team to a new market
One of the keys to business success is to use the experience of others in achieving your goals. What separates a good business from a great business is how they acquire talent and build a pool of skilled and experienced employees.
My clients often tell me how starting a new business operation on the other side of the world presents a major management and governance challenge. Not having the expertise and knowledge of the local market could make things very difficult when expanding to a completely new geographic location. The cost of relocating people and their families could also be quite high and should be considered as well.
Attempts by the senior management to be in more than one place at a time can backfire. Top management should be willing to relinquish some control from HQ to get things going.
Most clients understand that in order to be successful, they want to hit the ground running and leverage from the experience of others. No one wants to spend the first year learning the basics and making rookie errors –certainly not in a market as competitive as that of the UK.
Your Long-term Goals
You have to take a holistic approach when trying to establish an effective governance structure in a new geographic location. There are no one-size fits all models.
It’s quite important to look at your long-term goals and more importantly to have a key plan of action before heading over to the UK. The plan needs to be clear in what you are trying to achieve, in what timeframes you are going to do it and how much it will cost to get your return on investment. Some things to consider:
- Why the UK?
- Are you simply expanding to improve your brand awareness or do you want to explore the local UK demand for your products or services?
- Do you intend to take over a major market share?
- Are your products or services completely new?
- Or does something similar exist in the UK?
- Who are your competitors?
- And most importantly who from the home team is best suited to relocate to the UK to make this happen?
The most important part of business expansion is to select a leadership team that can deliver great results. This is an area that many businesses struggle with when expanding to a new location.
For example, if you are planning to raise capital in the UK then investors will expect to see the Founder or CEO on the ground and not some junior lackie on a European tour.
While it can be tempting to bring your own management team from abroad, consider the limitations. The UK market is quite complex and well developed, unlike the Aussie or NZ markets. Unless they have worked in the UK the foreign managerial staff might not know which strategies work and which don’t in this mar
There is a difference between having worked as an Aussie or Kiwi in the UK when you were in your youth and it was all about the Walkabout pubs and attending sporting events, making just enough money to travel on the cheap compared to starting a business. Yes, sometimes people that return to start a business after some time back home have a rude awakening – the UK has changed since you were on the holiday working visa.
They will be playing catch up for the majority of the time, trying to keep up with local businesses. They will also find it difficult to find great opportunities in the market. There is no substitute for a great network.
If your management team doesn’t know the right people in the business world, they will struggle to create an effective supply chain.
If you do bring your own management team from abroad, then it is highly recommended to at
least add a few local experts to the board. These experts can guide you about local market conditions and cultural differences.
They can be invaluable in keeping your business competitive against UK companies. As board members, they can bring new ideas that can connect you to the right people and become your brand ambassadors and sounding board.
Global Front Room has a large network of business experts in a variety of industries. Our experts can help your business in the initial stages of setting up, when things are the most difficult. We can also help you establish a highly effective board to face off to the home team to provide guidance and accountability.
Once you determine your long-term objectives and goals, the next question is to determine how many resources you are looking to dedicate to the venture. Think in terms of the human resources in your company. Which people should be assigned to the new expansion?
Quite often we see the wrong people sent over either to save costs or due to other commitments or sending a junior person over so they can get “international experience” however no support is provided to them whilst they are here. You should commit your best resources to a new venture or at least ensure you have a support network such as an on the ground advisor for your team to work with. Penetrating into a new market is risky whether you fail or succeed. I always advise my clients to err on the side of caution and not spend more than you need to.
Some new ventures like to make a big splash when they land in the UK. I have seen businesses that went overboard with marketing and advertisement budgets or set up major production facilities without taking the market demand into account.
There is no point sending people over without any money. You know the old saying: “You need to spend money to make money” It amazes me how many companies don’t manage a budget or feel they can enter the UK without a market entry budget to support their strategy. I have spoken with a number of companies who believe they can enter a market without having a budget for basic set up costs such as:
- Setting up a Company
- Business Insurance
- Accountancy fees
- Legal fees – especially in decided I the company structure globally
- Visa costs
- Basic office space
- Getting compliant – Health & safety, licensing, data protection. Gov UK has some great tools to take you through this.
But quite quickly they learn as my economics lecture would say : “there’s no such thing as a free lunch” and without having the resources to set up, growing the business soon becomes a challenge. We have worked with a number of businesses that have waited until its almost too late to set the budget and ensure that head office on board with what is required.
If you are looking to set u a team in the UK then please get in touch before you arrive. We have a number of experts that can help you Prepare before landing and expanding into the UK and help you find top talent to help with in market activity.
Join our network and get in touch to find out how we can collaborate and help you start and improve UK operations.
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