An international market entry plan contains hundreds of elements, but these initial 20 are the most critical for success abroad:
(1) An appropriate amount of planning time. Too often, companies approach foreign markets and cut corners on planning time. Executives won't dedicate their time, hire the correct resources and spend the money to plan a proper market entry strategy. The idea of getting on a plane and getting a deal simply doesn't work overseas.
(2) An actionable goal. A goal is a number. Goals can be sales volume, number of accounts, market share, points on customer satisfaction surveys, margin, profit, ROI or whatever benchmarks the firm uses. Frequently, markets are approached without goals that can be articulated inside and outside the company.
(3) A realistic objective. Meaning, where does the company wish to be, usually regarding market position. For example, are you the low-cost supplier? Are you the market leader? Are you associated with a luxury position in the market? Are you the convenient choice? Are you aiming for profit or market share?
(4) A logical market-screening mechanism. Buzz phrases such as "China's 1.5 billion people" or "Denmark's 4.2 million citizens" point to laziness when defining which markets to approach. Use a matrix that makes sense to your organization.
(5) A true understanding of the market conditions. How's the market organized? How does distribution work? What are the price points? Who are the major players?
(6) A regulatory strategy. Which foreign governments will help you, and which ones will block your progress? Are you in touch with local leaders when necessary? And will your government allow you to sell in a foreign market? Are there any conditions you must satisfy to be able to do this?
(7) A competitive analysis. Who are you displacing by being in the market? Who will try to block your presence there? What advantages do you have over your new competitors?
What is their competitive advantage, and how will you overcome it? What are your rivals doing to price, promote, distribute and enhance product?
(8) A true understanding of the customer. What are the customers' buying habits? Who are the customer groups? How will you approach the clientele?
What is the sales cycle like in this country? What motivates the client to buy? Are customers open to the idea of new players in the market?
(9) A genuine mode-of-entry strategy, What will be your way into this market? What kind of support will your salespeople need? Will you be selling directly or through some form of distribution? Are there other firms you can cooperate with to gain market entry?
(10) Realistic expectations. Has your firm been educated in how long and how difficult this market will be to enter? You must carefully study each market, as they have their own characteristics.
(11) The correct market champions. Companies often leap to the conclusion that success at home will equal success abroad. The one-liner about this is: "Jim Bob did such a good job selling in Kansas, we're giving him Tokyo."
(12) Cross-cultural and multi-country training. Does your staff understand the nuances of doing business in the countries you've chosen? Are you training them continuously?
(13) A roadblock map. What impediments exist to your success, such as cultural, legal, political, infrastructure, personnel and funding?
(14) Interest in more than the money. Do the people involved really enjoy the country in question? Are they invested personally in learning some language, the customs, the food, the entertainment? If an executive loves India, they'll have a higher probability of success than someone who merely tolerates it.
(15) Feedback on market conditions. Do you have a mechanism to gather and disseminate information on the market? Will the knowledge be utilized?
(16) A budget that makes sense. Prepare a budget only after you've set goals and objectives, and have gathered and understand market knowledge. We continuously see the opposite approach of "let's throw X dollars at the market."
(17) Executive investment. Not a budget, but an investment in time and effort. The CEO who flies to Paris for a two-day meeting is basically telling the French: "I don't care about you; I just want your money."
(18) Humility. When we play in someone else's sandbox, we need to remember we don't set the rules, they do.
(19) Patience. With the main cultural difference being how time is viewed, we can bet that our international counterparts will take longer to make and implement decisions than we do in the United States.
(20) Willingness to learn. Marketing and selling abroad is an educational process. If we can't take the nuggets we discover overseas to improve our businesses, then we may never succeed.
These elements are necessary for success in every market, as well as your own.