UNIVERSITY PARK, Pa. — Entering international markets can help a successful business grow even more. But when is the right time, and what are the steps?
Terrence Guay, clinical professor of international business and director of the Center for Global Business Studies at Penn State, shared in the following Q&A steps and resources, including an April 17 event hosted by the Penn State Smeal College of Business, for taking a local business to global markets.
Q: What advantages might a local or regional business see when expanding to global markets?
Guay: Going global can be an excellent growth strategy. I’m always amazed to learn about companies in the central Pennsylvania region who export — sometimes for a significant amount of their total revenues. It also can be a good diversification strategy. The U.S. economy is not always the fastest growing, and sometimes certain regions or customer bases may be struggling. Other countries and regions are often growing more quickly, so expanding overseas provides opportunities to offset slowing sales in the U.S.
Q: How does a business owner know when it’s the right time to expand overseas?
Guay: There are a couple of signs. One is when a company starts to get inquiries from abroad. It means their product is successful and word is spreading. A second sign is when a company starts to see U.S. sales slow due to market saturation. If senior management feels it is comfortable navigating the U.S. market, it is time to take on a new challenge by dipping their toes in the global market.
Q: What are the steps to taking a business beyond the regional or national market?
Guay: The first is to carefully select which market(s) to enter. Companies need to research market opportunities, entry modes, shipping strategies, distribution channels, payment processes and other factors. This can seem overwhelming at first. Thankfully, there is a lot of support for this.
The Commonwealth of Pennsylvania has a fantastic network of overseas offices and local export advisors. SEDA-COG is the contact for central Pennsylvania and does a fantastic job helping companies take their first steps — and sometimes many later steps — going international. Best of all, commonwealth assistance is free! The U.S. Commercial Service, with offices in Harrisburg, Pittsburgh and Philadelphia, also are an excellent resource.
Q: Penn State’s Smeal College of Business is co-hosting an international business seminar for Pennsylvania businesses on April 17. What could those businesses take away from the event?
Guay: The conference provides a great networking opportunity. Presenters will be representatives from the local, state and federal levels who are offering advice to help companies go international, particularly those who have never done this before. Smeal faculty also will be participating, and they have done extensive research on international business and are happy to chat with attendees.
The conference is a good example of how Penn State builds relationships with the local business community. Penn State and the Smeal College of Business are hosting this conference, which is free for all attendees. In addition to sharing faculty expertise, the director of Smeal’s Business Career Center will describe why our business students would be strong candidates for internships and full-time jobs.
Perhaps most helpful, participants can learn from the experiences of others. Executives attending the event range from experienced exporters to those who want to go international but are a bit overwhelmed by what the process might entail. Just talking to others who have done this before can be a great way to develop the comfort level that is needed to start taking your business international.