Diversify your Business Internationally
In my career over the last twenty years or so as a consultant, speaker, and author, I have had the opportunity to visit and work in over twenty different countries across five continents including places as diverse as China, India, Croatia, and Uruguay. This experience has been tremendously enriching for me professionally and personally. Furthermore, it has enhanced my reputation in the eyes of my clients as a business consultant who understands and appreciates the practicalities and complexities of running business operations across international borders.
There is no doubt in my mind that this international experience has made me more valuable to my clients at home and abroad and has also contributed greatly to the robustness and diversification of my business.
It is as a direct result of the benefits that have accrued to my business from working internationally, that whenever I have an opportunity to speak in private or in public to other business people and to clients, I always recommend that they look for opportunities to diversify their own businesses internationally both on the supply side and on the demand side. Of course, I do understand that the prospect of doing business internationally can be daunting for some, particularly if they lack prior experience, and I also understand that for others, particularly those whose businesses operate principally within very large national economies, the perceived need and urgency to take on the additional challenges and complexities of boing business internationally may be absent.
However, apart from the fact that I believe in the long run having an international element will be a necessity for most if not all businesses, my argument is always that the benefits and rewards do massively outweigh the costs and risks if approached in the right way. Why do I think that internationalisation will ultimately be a necessity for most businesses? One reason is that international contact and exposure is a great way to enrich the creative culture of your business to help it to innovate, grow, and to be more competitive, and economically sustainable. Another reason is that having supply and demand options in diverse markets will insulate your business against the ups and downs of the normal business cycle in your home country. Furthermore, chances are that foreign competitors are already active in your home market taking market share away from the incumbents and so you had best respond in kind if you aim to be around for the long haul.
The good news is, that despite talk of protectionism and trade wars on some fronts, it has never been easier to make connections across international borders to conduct international business and gain competitive advantage. There are several reasons for this, one is that new free trade agreements continue to come on line and to be renewed such as those between the EU and Canada, the EU and Japan, and the EU and Mexico as well as the recently renegotiated free trade deal between the US, Canada and Mexico. Another reason is that advances in information and communications technology have greatly facilitated the practicality and slashed the costs of communication and the exchange of information and data between international trading partners. Yet another factor is that the capabilities of international supply chain service providers in logistics, transport, finance, and regulatory compliance have been greatly enhanced and made much more accessible in recent years.
No doubt, the emergence of English as the de facto international lingua franca for business has greatly facilitated international dealings across the entire globe. Nonetheless, when looking to diversify internationally it is important to bear in mind the various aspects of proximity that will greatly facilitate the endeavour. Statistics from the World Trade Organization (WTO) clearly show that countries still do most of their international business with other countries that are geographically close to them, or that share a common language, a common legal system, or are part of a common market or free trade area. When you look to diversify supply or demand side opportunities, do keep these considerations to the fore. Be bold and be pragmatic, realise that the reality is that the upside rewards for the successful international diversification of your business can be truly dramatic, while the risks and challenges are eminently manageable and the additional tangible and intangible benefits that will accrue to your business, your workforce, and to you personally will be hugely rewarding.
In my new book International Supply Chain Relationships – Creating Competitive Advantage in a Globalized Economy, published by London-based editorial Kogan Page, I explain the Who, Why, Where, What and How of setting up and nurturing the key business relationships that will support your international business dealings in the future. You can pre-order here Click Here To Order a copy
© Patrick Daly 2019