Top Considerations When Expanding a Brand Internationally
Expanding internationally is daunting if you've never done it before, but here are the top considerations as a brand owner looking to expand internationally.
1 - Demand
You always start with the customer. Your target demographic and behavior consumers - are there countries they are concentrated in?
Will you have to generate demand, or does demand already exist?
If you need to generate demand, consider a local marketing partner.
2 - Inventory Placement
When you expand internationally, having flexibility with where you place inventory is important. Sometimes partners can help you across an entire region, other times they serve only one area.
Is it just Canada? UK? A place in Europe that could give you a base for 2-day service for the mainland? Israel? GCC countries in the Middle East?
Is retail in your future?
3 - Inventory Classification and Regulations
How do shippers, customs agencies, and other players classify your products? Most of these standards - but not all - are based on HS Codes, or Harmonized System codes assigned by shipping carriers (often for a big fee).
With a large complex catalog (think: marketplace), this is its own workstream. With a few product lines, it could be simple but so much depends on materials. Even buttons on a shoe or coat can make a difference in classification.
4 - Duties and Taxes
What will you be assessed and how will you know? Consider having your buyers pay duties up-front to avoid surprises, but DDU can be useful for certain buyer types.
5 - Payments
What payment methods are prevalent in each country? How will you offer the range quickly and easily with low rates?
Do you need to establish a local entity, and should you?
You'd be surprised to learn that in many markets, cash on delivery is still over 50% of consumer parcel volume -- which is completely unaddressable by the major carriers.
6 - Shipping Carriers and Packaging
Do certain product lines have restrictions for air (think: flammable)?
Should you go with a single carrier, or a consolidator that uses multiple carriers?
7 - Customer Service and Returns
Do you have the ability to answer buyer questions and how? Should you insource or outsource?
What do you do when your customer wants to return it? Destroy in market? Resell (where?)? Donate? Recycle?
8 - Cross-Border?
I spent 3 years at Pitney Bowes running their Cross-Border product team -- these services help a brand test demand and grow a sizable business.
Consider a multi-year test of various markets, and then you can break apart the services to gain rate leverage as your business grows.
9 - Technology
How easy is it to tie the international or cross-border expansion concerns above into your existing technology infrastructure? Including ERP, eCommerce, customer service, POS, etc.
