What are some common mistakes that businesses make when entering a new market?

AlbertBassett 1 month 2023-02-23T10:26:52+00:00 0 Answer 0

Answer ( 1 )

  1. That is a good question to be asking. And it is important to ask it early because most of the mistakes that businesses make when expanding happen in the preparation phase of the expansion. Here are some pitfalls you should try to avoid when expanding to a new market.

    1 – Failing to research the market: One of the biggest mistakes that businesses make is failing to conduct sufficient research before entering a new market. This can include not understanding the local culture or customs, not researching the competition, not analyzing the target audience’s preferences, etc.

    If you are conducting market research, make sure to partner with a market research agency that has experience with your target market. Or work with an agency that specializes in helping businesses expand internationally, as is the case of Kadence International. The market research agency that helped you understand your local market may not be the best match for helping you expand into an exotic country.

    2 – Underestimating the costs: Entering a new market can be expensive, and businesses often underestimate the costs associated with launching a new product or service. This can include the costs of marketing, logistics, and hiring new employees. It’s always a good idea to include room in your budget for unforeseen costs.

    3 – Failing to adapt to local regulations: Many businesses also make the mistake of failing to adapt to local regulations when entering a new market. This can include not understanding local tax laws or not complying with local licensing requirements.

    This isn’t just a problem when expanding to another country; expanding to another US state or even to another city still requires a legal assessment. There are many ways in which different jurisdictions can affect your business, and governments will often be harsh with businesses that expand without complying with local regulations to set an example.

    3 – Failing to establish strong local partnerships: It’s always a good idea to try to work with local suppliers and hire local employees. Working with locals who have a better understanding of the local market can help prevent all sorts of issues in the long run. It can also help you project a positive image to the locals.

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