Advice on how to take your business global
In advance of the Business School’s Building an International Business Masterclass, Professor Simon Harris provides advice for alumni looking to take advantage of international markets.
We know from alumni events, surveys and correspondence that many of our graduates are entrepreneurs, business development managers and marketing directors, and that internationalisation is of upmost interest to those looking to grow and evolve their businesses.
With business headlines dominated by digital upstarts making a global impression with relative ease, you’d be forgiven for thinking all you need to break into a new market is a steady broadband connection, Skype and a ‘can do’ attitude.
But despite the hype, the fact remains that doing business in another country will always be different, and more difficult, than doing it at home. To provide perspective and clarity we enlisted the help of the Business School’s Professor of International Strategy Simon Harris, who is is leading the Building an International Business Masterclass in September 2016.
Professor Harris, whose career includes time as a strategic planner in the textile industry and investment manager, now advises businesses on their international development and researches how organisations develop and use relationships overseas.
As a taster of what the Masterclass will provide, Simon shared his top three things that are guaranteed to stop a foreign business venture in its tracks.
Building relationships is critical. It underpins everything from securing access to customers, to navigating a country’s complex regulations. You have to do your research and gain friends on the ground to be successful. But there can be significant cultural differences in how relationships are built. In the US and UK, where relationships can form more quickly, it can take as little as an elevator pitch. In India however, these same relationships can take generations. Few Scottish distillers have managed to penetrate India’s whisky market – one of the largest in the world – because they haven’t developed relationships with the right groups.
Simply put, if you aren’t organised, you won’t build relationships. But perhaps the more fundamental concern is that you will be risking your reputational capital if you don’t take the time to research the contacts you want to do business with, and conduct due diligence on their operations. UK fashion group Arcadia were the most recent in a long line of UK companies to face a backlash, when allegations emerged that its ‘Ivy Park’ clothing line – endorsed by Beyoncé – was being made by sweatshop workers in Sri Lanka.
Failure to learn
Every business failure overseas comes down to a failure to learn. It’s important to find someone with the right local knowledge, the will and the time to teach you. Tesco believed its focus on fresh wholesome food could carve a niche alongside bigger wholesale retailers. But it underestimated the US customers’ preference for cheap bulk buying and had to pull the plug on its 199 stores across the Atlantic at a brutal cost of £1.2 bn.
If you are interested in finding out more about the Building an International Business Masterclass then visit the Business School website for further information, course dates and booking details.
There is a 20% discount for all University of Edinburgh alumni.