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Updated 29 Sep 2020

3 Mistakes to avoid when going global

Entering a foreign market is risky, especially if you haven’t done your homework. Here are three mistakes you should avoid when trying to do business in foreign regions. 

GG Van Rooyen, 04 November 2016  Share  0 comments  Print

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Expanding into foreign markets is never easy. Big brands such as Burger King, Starbucks, Groupon, McDonald’s, eBay and even Google have had some embarrassing experiences in foreign regions. So, what do companies tend to get wrong when expanding beyond their own border?

Related: Beyond border risks


Entering a foreign market, particularly one that is very different from what you’re familiar with, is difficult and risky. Make sure that you prepare carefully before taking the plunge.

They don’t understand the culture

It’s incredibly important to understand the culture you’re going into. Just because a concept works in one region doesn’t mean it’ll work in another. China and Japan are notoriously tricky places to expand into, for example, simply because they are so different from Western countries.

Tastes are different, business is conducted in a different way, and languages are vastly different. Many companies have come to the realisation, for instance, that their product name translates into some rude word in the local tongue. If you don’t understand the language and the culture, you need to tread very carefully.

They don’t take time and distance into consideration

Time -and -distance -business -expansion

We live in a globally-connected world, sure, but that doesn’t mean that managing an operation on the other side of the globe is easy. Time differences and vast distances have a huge impact on business.

What happens when there’s an emergency you need to attend to and you’re fast asleep in your bed? What if you suddenly need to jump on a plane and take a 17-hour flight? Who’s going to take care of things at home? Many local companies have opted to move into Dubai or the UK first when expanding, simply because these time zones are similar to ours and getting to these places is not that difficult.

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They don’t have local partners

A solid strategy when going into a foreign market is to take on a local partner, usually in the form of some sort of joint venture.

A local company will understand the business landscape much better than you ever can, so it’s worth tapping into their knowledge and experience. Just consider Krispy Kreme and Starbucks, which both recently came to South Africa. These companies, despite being large and successful, didn’t decide to go it alone. Instead, both are making use of local partners.


Make sure you do careful research before deciding to enter a foreign market.

Ask yourself:

  • Do I understand the culture and the language?
  • Do I understand the business landscape?
  • From a practical standpoint, will I be able to manage a foreign operation?
  • How could I include a local partner in the process?
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GG Van Rooyen

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