To date, few businesses have recognized the full scope of performance improvements that globalization makes possible.
1 - Enter the export activity by chance, not by strategy. Some examples of European companies, Hivebeat or Drugstore. They start expansion in US because they found their first client, then they lose focus and start investing in US until they run out of fuel.
2 - Not knowing the foreign business culture. Local business by local people. You can't pretend to understand the structure of politics and cultural society.
3 - Lack of discipline in proper homogenization of styles. Dinner Lab or Yeloha spend a lot of tyme creating customized products. It can be a good strategy for start off, but in the long distance run of entrepreneurship you need to be scalable. Without proper product packaging you won't grow.
4 - Be flexible. Every successful startup I know has pivoted a couple of times, as they learn what really works in the marketplace and in the sales process. Did you know that both YouTube and Facebook started out to be dating sites?
5 - Complete orders with balances. No explanation needed, companies should control their cashflow better.
6 - Having only one single customer abroad. Sometimes if you export or resell in one country it's good you start with one client, but swinging into new clients is a must. I recomend even selling near dumping prices, just in orther to increas your presence.
8.- Not enough research of future tendences or trendhunting. Selling without knowing the specific trends of the country is more common that what you think. Target (fashion company) entered the Canadian market with more than a hundred stores just two years ago. After widespread consumer disappointment and massive losses, Target announced that it was closing all of its Canadian stores.
9. Political situation. If you don't control the political situation at least two years ahead and don't know when you will receive ROI, investing in foreign markets it's hard. One of the best examples was Spain in 2008. After a three years of huge growth of the international investment in clean energies, the opposition won and cancelled all the grants, creating even a tax for energy self-production.
10. Bad partnerships. According to the most recent data from the U.S. Census Bureau, there were 3.1 million partnership tax returns filed in 2008, up from 1.8 million a decade earlier. But as the number of partnerships has grown, so has the number of business divorces.
Organizations that can realize the full potential of globalization will see dramatic revenue growth. Those that can’t will lose market share.
How global is your industry?
To realize the full potential of globalization, you first need to assess where your industry falls along the globalization spectrum; not all sectors of the economy face the same challenges or opportunities at the same time. To measure how global your industry is, calculate the ratio of the annual value of global trade (which includes trade in product components as well as final goods) to the annual value of industry sales.
Ratios over 100% indicate industries that are very global.
Farm, Services, Food processing, trade&transportation and Manufacturing are they key sectors. Inside Services there's also a 5% of It/business process. Is finally just a 1% of all the export companies.
The main problem of IT companies is the lack os specialitzation, not enough ways of trascending know-how in other regions.
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