What Companies Shouldn’t Do Regarding Overseas Business Expansion

When the time comes, companies eventually start considering launching an international expansion strategy to reach more potential customers. There are several reasons why businesses enter foreign markets. Some of these include asset diversification, more investment opportunities, access to more talented individuals, and global brand recognition.

However, the road to a successful international market expansion involves several risks, which should be expected given its potential benefits. Without careful consideration, companies are at risk of losing significant funds as their investments turn into dust. Therefore, careful planning is necessary for determining the success of an expansion.

If you think that your company is ready to begin investing in an overseas business expansion project, you must create a team responsible for checking the advantages and disadvantages of your decision. Additionally, they should be wary of the possible mistakes that could occur at any point during the expansion process. Without this sense of awareness, you are placing the project at risk of failure.

Therefore, here are some things companies should not do when starting an overseas business expansion project. Continue reading this article for more information.

What Companies Shouldn’t Do Regarding Overseas Business Expansion

1. Starting the Expansion Without a Plan

When dealing with projects like international market expansion, a plan is critical in ensuring that everything flows smoothly. Moreover, it establishes the rules and regulations of how to accomplish the necessary steps to a successful entry into a foreign market.

Without a plan, the team responsible for your company expansion project may not have a unified direction. Some may pursue other paths they feel should be a top priority. Therefore, to ensure everyone is on the same page, formulating a plan should be one of the first steps when expanding overseas. It would act as a timetable on which tasks to accomplish for the day.

2. Formulating Vague Plans

Another mistake to avoid regarding plans is formulating objectives or instructions that are too vague. For example, if your company is launching an overseas business expansion project, refrain from setting goals like setting up branches in Asia. If you think about it, you are trying to enter the market of one continent, comprising over forty countries. Each nation has its own culture that sets them apart from its neighbours. Therefore, your team may find it tough to analyse and provide valuable data on how to proceed toward the subsequent stages of the project.

As much as possible, consider specifying the countries or regions. Using the same example, you can state your parameters within East Asia. Doing so allows your team to provide higher quality and more relevant information regarding how the expansion should proceed.

3. Rushing the Expansion Process


Now that you have a solid plan on how your international market expansion project should proceed, the next mistake you could make but should avoid is rushing the process. As mentioned before, expanding overseas involves plenty of risks that could guarantee the failure of your project. Therefore, spending adequate time on analysis and research allows your team to gauge the pros and cons of whatever decision you need to make. Additionally, they can formulate contingencies in case something goes wrong.

4. Not Investing in Local Talent

Entering a foreign market is not easy, that much you should know by now. However, you can make your company expansion project less troublesome by hiring local talents to assist you in developing your presence in a country. Having these employees working with your team allows your business to adapt to whatever changes it needs to make. For example, these individuals can walk you through their work culture and support less-experienced workers without worrying about time zones.

5. Acting You Know More Than Your Local Teams

With a team of local experts to assist you in your overseas business expansion project, you should be able to train your employees to work in an environment with a different work culture. However, never hinder your local talents from providing you with tips or assistance. You shouldn’t act like you know more than them. After all, these individuals have more experience and knowledge when it comes to their market. In this case, you are likely to spend most of your time as a student learning from them. However, ensure that your team doesn’t entirely rely on them.

6. Forgetting to Research Local Culture

While enlisting the help of local talents is beneficial in determining the success of your international market expansion, it is equally important that your team does the necessary research on the local culture. After all, your company is entering a foreign market dominated by established brands. Lacking awareness regarding the local culture could doom your branch and lead to bankruptcy. Therefore, the first step in establishing a presence overseas is to research relevant information regarding their way of life.

7. Ignoring the Need for Localisation


While your products or services may be effective in your local market, it doesn’t necessarily mean they would achieve the same success once you expand overseas. Localisation is crucial in ensuring customers continue to support your company. This step involves understanding their language, slang, perspective, and expressions. Lack of awareness will guarantee disappointing results.


Starting an overseas business expansion project requires significant funding and effort. Careful planning and preparation ensure your branches on foreign markets don’t fail. One of these involves raising awareness of the possible mistakes you or your team could make. Here is a quick recap of those seven points.

First, never expand overseas without a plan. Otherwise, your team would lack order in determining which tasks they should prioritise.

Second, your plan shouldn’t contain vague goals or instructions. As much as possible, try to specify those things.

Third, international market expansion takes time. Never rush your team. However, ensure that you provide adequate time to accomplish the tasks.

Fourth, enlist local talents to assist your team in establishing a solid presence in a foreign market. Without them, you are more prone to making mistakes regarding their work culture.

Fifth, never dismiss the assistance of your local talents. You hired them to aid you in establishing a presence overseas.

Sixth, never forget to research how things go in the country. Study their work culture, traditions, and mannerisms.

Last, never assume that your products or services will remain successful once it enters a foreign market. Without the necessary localisation, you are at a higher risk of failure.

If you’re starting an overseas business expansion in Germany, contact Scaler8 to receive professional assistance and aid in understanding the local market. Visit their website for more information.