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Getting your ducks in a row

Jan 17, 2010 12:05 AM | By Michael Williams

Expanding into international markets is not simply a matter of choosing a sunny country and setting up shop.


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In fact, says Julia Fourie, CEO of venture capital company Here Be Dragons, most of the hard work happens before you've left South Africa.

"Take some time to understand where you want to expand. Don't expand necessarily to the biggest country - in population or gross domestic product - but rather to your biggest customer base. Understand where your customers are and then find a country."

This involves dealing with any legal or bureaucratic snags that may come back to haunt you.

"Have a look at any legislative problems. Is it one of the countries whose currency we won't accept? What about other factors, such as time zones and language? Build up a list to help you decide where to go first and why."

Local business culture is another factor to bear in mind. Julia points to the classic example of the differences between East and West.

"Americans, from the first day of meetings to closing a sale, might take a month, but with the Japanese, it might be eight months. Their cultures and how they do business is very different."

However, there are rich rewards beyond the minefield of international business. These include access to new markets; an opportunity to earn hard currency while maintaining a cost base in rands; the potential to outsource business operations to locations where conditions are optimal; and a diversification of political and economic risk.

Although a huge amount of preparation needs to go into the decision, Julia emphasises that it is not necessary to take this all on yourself.

"One should really consider going to experts in all those areas, say finance or legal, to build up the plan, and then you can focus on sales or what you are actually good at.

"South Africans are very resourceful, and are able to do things by themselves, but don't realise that sometimes it is easier to get an expert to do something for you rather than getting caught up in all the bureaucracy and issues that need to be resolved," says Julia.


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