Your Company is Ready for a U.S. Expansion—Even if You Don’t Know it Yet

September 14, 2015

in Plan Your Expansion

Authored by Zubin Mowlavi

Your Company is Ready for a U.S. Expansion—Even if You Don’t Know it Yet

Deciding when or if you should expand your small business can be a nerve-wracking prospect. We’re sure you’ve heard that if you expand too soon or too fast, you could end up losing the momentum you’ve built up over the life of your business, causing it to stagnate or fail.

On the other hand, there are a few clear signs that it’s time to come stateside. And, despite the cautious pessimism that pervades the business world, the U.S. market is a premier destination for new and expanding businesses. Technology has long-since broken down the hurdles that cause people to resist growth to U.S. shores.

In fact, given the low barrier to U.S. expansion, you could start your planning today. Here are three reasons you’re likely ready to move forward with a U.S. expansion, even if the idea never seemed possible.

1. You’re Growing

If you’ve built strong relationships with your client base, and have a steady flow of repeat business, it’s time to start looking for new customers to target.

This has never been more possible in the U.S. Sure, products that sell well in your home country may not necessarily have the same appeal elsewhere, so it’s crucial to invest time and energy into researching potential U.S. markets.

With that said, the U.S. is comprised of such a wide range of cultures and audiences that it’s not as much a matter of “if” your product will resonate, but rather “where.”

You want to research regions that fit your product or service, and get a first-hand idea of how your business will fare. This will give you the opportunity to not only conduct research and test your product in the U.S. marketplace, but also to experience the culture and social norms of the people to whom you’ll be marketing.

We advise looking for markets that are similar to yours (spoiler alert: they likely exist in the U.S.). While the business environment won’t be identical to the U.K., you should make yourself familiar enough with it that you can ensure smooth, seamless business discussions.

In turn, it’s important to remain consistent in branding, but also to adapt to the environment. As mentioned throughout Spark, varying cultural norms and customer needs in foreign countries may require you to adjust your sales approach, or even your whole product. While you must stay true to your overall brand, it’s important to tweak your product slightly to account for local tastes.

Also, be sure to allow for appropriate localization and flexibility to adhere to local customs and customer needs. One of the key areas to adjust is with material sourcing. If you can maintain quality, local sourcing has the opportunity to improve cost margins and reliability.

2. You’re in Demand

If you’re starting to miss deadlines because you have too many orders, it’s likely time to grow your business to a larger audience to match the growing demand.

If your company is too small to keep up with a growing client base, your customers are going to start looking elsewhere for a company that can meet their needs. Expanding to the U.S. allows for new supply and distribution channels, wider and more diverse audiences, and simply more people to which to market.

Waiting too long to expand when you’re struggling to keep up with orders will affect your employees’ morale and overall productivity. You could consider expanding to a new location, or just add more workers to your current production line.

With that said…

3.  Expand

First, let’s address the economies of scale. As your business increases in size, costs-per-unit drop, resulting in lower prices or higher profit—or both. You should only expand if this growth will allow your business either to sell at lower prices or to take more profit per item.

In U.S. markets, you’ll likely be able to sell more and increase your sales. Your business may also benefit from having more resources such as bigger and better facilities, increased marketing resources, and added product features that provide more value for customers.

If your profits have leveled out, and you’ve been making consistently the same amount for some time, your business might be ready for growth. Even better is if your cash flow and capital have increased to the point where you won’t have to look for loans to expand.

Market intelligence should also play a key part in your U.S. expansion. You may be able to get important clues about the market, and some indication about your competitor’s situation. Getting information about your competitors can give you the leading edge, as it can show you ways in which your company benefit the customer and be unique.

If your competitors are increasing their operations, it may mean that they have seen new, untapped opportunities in U.S. markets.

Expanding your business is a major step, but shouldn’t be a source of anxiety for many small business owners. Through digital means, it’s much easier to manage overseas locations, new staff, or even a new product lines. Standard communication and productivity gaps are eliminated, narrowing the divide between your company and myriad new audiences.

If you’re seeing the signs, it’s time to move your business beyond U.K. shores. There’s never been a better time to do so.

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