Successful CEOs reveal why it’s vital to understand the market and hire the right people to take it global
What is the best way to excel your business in overseas markets despite culture and legal barriers?
Taking your business overseas is one thing but prospering in a global market is another. Speaking on the first day Elite Business’ live event on March 9, Arne Mielken, Vice President of the Institute of Export & International Trade, James Hyde, CEO and Co-founder of James & James Fulfilment, Greg Sutch, CEO of Intralink, Sean Blakeley, CEO of the British Chambers of Commerce and Marko Ilincic, Group Chairman of Vistage, revealed how important it is for business to be open-minded and adaptable when expanding their company across borders. They discussed how it is vital to understand the markets before preparing for and overseas expansion, and why businesses must place a stronger focus on building relationships with customers and clients abroad
Mr Ilincic, Group Chairman of Vistage, urged businesses who are new to the game to reach out to other big organisations for advice and tips and learn from those who have successfully taken their brand global. “Talking to other companies is really important,” Mr Ilincic said. “Sometimes I think you can be very insular as an organisation. Reaching out to organisations is important. When I was in Lego for example, before I led the brand through expansion into China and invested multi-millions of pounds, we talked extensively to several big brands who did it before us. Adidas was an example. Not a competing brand of course in a very different industry… But we learnt so much from talking. And it was for free, this wasn’t a consultation, there was a mutual exchange of information. I would encourage you to think about brands and businesses you admire that might be there already and reach out to them.”
Businesses are often faced with a pressing decision on whether to hire someone overseas or send their best talent from the UK to help expand their business globally. Greg Sutch, CEO of Intralink, insisted this did not matter, but stressed that it was far more important to find someone who was cross-cultural, understands the market inside out and preferably speaks the language.
“It is critical that you answer the key questions in advance for entering the market and you need to confirm for yourself that there is a market.” Mr Sutch said before turning to Mr Blakeley to commend him for setting up and managing an office in Seoul over 10 years ago. “We went into Korea about 10 years ago and we employed this guy,” he said while giving Mr Blakeley a warm pat on the shoulder. “He was in Korea and he was brilliant. And we succeeded because we employed a first-class guy, he was our managing director before he started working for the British Chamber of Commerce. He built our business in Korea and he speaks fluent Korean, he’s truly cross-cultural. My advice is if you’re serious about the market, Mr Blakeley is an illustration about the level of commitment you need to have in the market… You can send someone over there provided they speak the language and are entirely comfortable with that part of the world, in my view.”
If businesses do not have the means or finances to take trips abroad to meet clients face-to-face, Mr Blakeley advised how companies can build relationships using technology. Speaking about the Korean market, Mr Blakeley said: “Technology does allow small companies to put their product out there. You can put your product online, set up a website in Korean or hire influencers in the Korean market that drive traffic to Amazon. Koreans are massively purchasing directly from the UK. Not saying that you always have to hire someone or always have to go to the country, that is the best way to create a sustainable business. But if you are smaller, then I think there are other measures. But if you can, then as Greg said, the best way to do it in that home market is to pick someone you believe that can do well.” On the same note, Mr Hyde stressed that it is highly important the employee understands the company’s mission and driving force.” Even you just hire someone overseas, making sure they spend enough time in your company domestically before they go back to understand who they’re working for and what the business is about,” he added.
It is important to understand how your customers and clients in different markets operate. Customers in different countries often exhibit different buyer behaviours. Therefore, it is essential to understand various cultural barriers in the market you are exploring, James Hyde, CEO and Co-founder of James & James Fulfilment said.
“There are cultural barriers, legal barriers and various others,” he explained. “I say those types of barriers are worth considering. The US is a massive market, but there is a reasonable cultural barrier and the way Americans buy is very different from how British people buy. When we sell our services in the UK, it’s very much a consultative sale… and people sign up for long contracts and they’re happy with that because they’ve spent a lot of time doing the diligence on what they’re buying. In America, they want to put the credit card down quickly and want the right to get on with it… They don’t care much about the long-term aspect of the contracts, so they’re very quick to buy but also very quick to fire you as a supplier and move somewhere else. Which means it’s harder to think about how to pitch your business better.”
Mr Blakeley, CEO of the British Chambers of Commerce, explained how important it is for business owners to fully immerse themselves and be committed to the country they are choosing to expand in. He urged companies to work on building relationships through face-to-face meetings rather than relying solely on internet correspondence as a means of communication. “If you have no intention to visit the market, then I suggest that you not try to enter the market,” Mr Blakeley advised. “The reason for that is, you have to think about what that says about your commitment to that market, to that partner or to that customer. If you’re not willing to pay for one economy flight to fly over to Seoul to talk to someone, then what really is your commitment? If your brand is really hot on the market, they might not really care what you do and how you treat them and you can maybe get away with it. But it is very unusual. The reality is that even though a lot of business can be done online and in conference calls, face-to-face is an important reflection.”
Mr Mielken, Vice President at the Institute of Export & International Trade, said businesses are often deterred from expanding overseas due to fear and uncertainty in global markets, explaining how more often than not, this one of the biggest factors preventing many companies from going global. “When businesses look at another market and then saying, this is far away, this is very complex and thinking, ‘Who do I know over there?’” Mr Mielken said. “It does take bravery to step out and do all these things we’ve been talking about. Regulation is one part of it, it is not the essential bit because at least in the beginning, you’re not going to deal with regulation until you have a market. So, you do have to get a market, and getting this is quite daunting and may lead to distractions because you are building your market in the UK.”