What is the preparation required to successfully expand overseas?

Formulation of overseas expansion plans

When expanding overseas, it is important to establish and manage schedules, goals, and evaluate each stage. Once the entire schedule has been created, the whole company and the team are moving in the same direction.

Overseas expansion requires a lot of resources and commitments, which can affect the amount of information you can obtain and the quality of your decisions.

However, depending on the evaluation at each stage, you need to be calm to go back one stage and consider it. It doesn’t have to be detailed at first, so we summarize the necessary process and the time to advance in a tabular form.

Production plans, sales plans, equipment plans, personnel plans, and funding plans are required. In addition to preparing a plan, list specific goals and KPIs at each stage of the business.

After selecting the core members for the overseas expansion plan within the company and forming a project team, we will draw up a detailed plan.

We also need to conduct on-site surveys and negotiate with local partner companies. At this time, we should not forget to build a team structure that can make decisions smoothly, since potential foreign partner companies may be disappointed by the slow decision-making of Japanese companies.

Information gathering and market research

The first thing that is important and difficult is collecting information. When we aim to expand our business overseas, we often do not know how to foresee and respond to risks that may occur on our first land. This increases the risk of failure.

Mistakes from ignorance, such as adopting inappropriate business methods or assuming the wrong target audience, can be fatal in overseas expansion with large investments. For this reason, appropriate information gathering is required even when information is physically difficult to obtain overseas.

Basic information includes country business practices, legal systems and business practices, worker temperament, and average labor costs. With regard to personnel expenses, it is important to know the approximate costs that will be incurred not only for general employment but also for management.

By learning about these, we can make the actual business a foundation for starting in a state that suits the local situation, and examine labor management and employment risks. When setting up sales bases overseas, it is also important to examine the interests of sales channels and target customers, the needs of our products and services, and whether we can enter the market.

Selection of the area to advance

We collect information and select countries and regions suitable for our business. When expanding overseas, it is very important to select an appropriate location after considering the safety and social conditions of each country, as well as business advantages. The social situation of each country is changing every moment, so let’s gather new information and thoroughly examine it.

Safety and social conditions are important aspects. Depending on the situation of the country, there is a possibility that employees dispatched for war or terrorism get involved. Also, depending on the country, you may not be able to enter as a corporation from Japan. Other than that, the legal systems of other countries are difficult to understand from Japan, but it is one of the conditions to confirm.

We also consider the possibility of doing business in the country or region. Whether there is room for your services and products, whether you can keep them within budget, such as labor costs, and whether you have a reliable partner.

In some countries, there is a big concern about the distribution situation and infrastructure. In some cases, the company may decide that it does not have the advantage or need to compete with local competitors, and it may need to significantly change its territory.

Preliminary survey and field survey

To prepare for overseas expansion, it is necessary to conduct surveys while in Japan and to go to the site. The primary purpose of the preliminary survey is to gather information on the Internet.

On the other hand, when collecting information via the Internet, there are concerns about the authenticity and freshness of the information, so it is important to determine the accuracy of the information. In order to make up for the shortage, it is also necessary to utilize platforms to support domestic expansion overseas.

In this case, you can get information from people and companies who have actually succeeded in overseas business for a long time, and the credibility will be enhanced.

It is necessary to conduct a field survey after a preliminary survey in Japan. Once a specific candidate for the host country has been decided, we will visit the host country to compare the results of the survey with the facts and to obtain information that was not available in Japan.

The preliminary survey collects a wide range of information such as laws, taxation, social conditions, labor, wages, and infrastructure, but it is necessary to confirm the actual information on the site with your own eyes.

It is also necessary to know potential partners and business partners through field surveys. Conduct interviews with potential partners and potential business partners to negotiate contracts.

In addition, companies considering overseas expansion as a manufacturing base need to select a construction company for plant construction and carry out procedures.

Summary

As described above, in order to expand overseas, it is important to carefully plan in advance, conduct a preliminary survey after deciding a candidate site, conduct a field survey, and follow an appropriate process to eliminate risks.

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