New Perspectives

Ready, Aim, Fire! Successfully Launching in a New Market
by Jack Crowley

I suppose we've all heard the expression, "Ready, Fire, Aim," indicating a snap judgment or rush to a decision and, as the expression indicates, the results might not be what we hoped for. It's critical to take the necessary amount of time to make a good decision. A little more time taken before initiating action can eliminate the damage control that typically results from a rushed decision.

READY

Recently I had the chance to talk with a colleague who had just undergone LASIK eye surgery. He mentioned that before having the surgery he wanted to be certain he chose the best facility and the best doctor to perform the procedure. As he began the selection process he found varying degrees of experience among the surgeons he interviewed; some had minimal experience and others had a good deal of experience. But he did find one doctor who, although more expensive than the others, had performed the procedure hundreds of times, always successfully and always with his patients' full satisfaction.

Even though this surgeon was a little more expensive, guess which one he chose? Absolutely! Experience is worth a little more when the likelihood of successful results is vastly improved.

Been There, Done That-Local Experience is Invaluable

In the marketplace, experience certainly beats a learning curve. The same holds true when attempting to launch a new business in an international market. In addition to contacting and meeting with local industry leaders and using the expertise of the Direct Selling Association within the market, having a local expert in place and on the ground watching out for our interests is extremely important in getting under way. There is no substitute for successful experience in a market. Finding and hiring experienced management talent early is one of the keys to putting all the pieces in place before a market opening. This is also insurance that, once the new business goes live, all the requirements have been addressed and contingencies prepared for.

Managing an international expansion initiative-usually from a distance and across time zones and cultures-is complicated, and can be extremely taxing, time consuming and frustrating. Having an experienced, local management team can help alleviate some of these stressful situations.

Specific advantages accrue from identifying and hiring local management talent well in advance of the start of operations. We have the opportunity to bring them to the home office where we can acculturate them to our business, train them in its workings and establish the necessary standards to be met in the new market. Also, there is the opportunity for them to develop relationships with the people at the home office who will be supporting their efforts in the new country. We now have allies on the ground, armed with training and knowledge, with specific tasks to accomplish and timelines to meet. We have people on the scene working every day on our behalf to complete objectives that cannot be as effectively managed from a distance.

AIM

There are many in-country tasks that can be critical in advance of actually starting the business. Experienced local management put in place early enables us to focus on and aim specifically at the completion of these tasks. For example, a business location becomes key, as an address is required on virtually all marketing materials and products. And let's not minimize the importance of establishing an infrastructure, including phones, faxes, computers, Internet connections and other local IT services to support the new business. Often, there is a waiting period for the delivery and installment of this equipment and, therefore, adequate lead time in ordering and local follow-up are essential.

Other key components are the adaptation and printing of materials that not only support the business but reflect any changes required to make the materials specific to the new market. This is especially true if your products are regulated or if you anticipate international sponsoring activities in the new country. Having international sponsors attempting to launch a new business with incorrect product claims and improper or incorrect materials is a path to be vigorously avoided.

Also, the establishment of a distribution method is a key component of the pre-opening requirements. Local management can evaluate the benefits of in-house vs. third-party distribution and can assess the capabilities and efficiencies of both options to ensure the best support for the new venture.

Strive for Transparency

In the international expansion process the ability to leverage the company's field assets is critical to a fast start. The greater the success we have in exciting our existing field leaders to journey to the new market to hold opportunity meetings, network among local contacts and conduct training about the company's products and business opportunity, the sooner the new business will take root and begin to grow.

Country-specific programs and compensation plans, while of some benefit, also have a downside. Most notably, if we rely on international sponsoring to help catapult the new business, country-specific programs will force experienced field leaders to adapt and learn these new programs that are not in concert with their existing business. With this requirement, there is always a risk that learning a new set of procedures or a new compensation program may be perceived as not worth the effort. Further, if our goal is to build a truly global business, that objective would be next to impossible to achieve with multiple plans and programs in place in numerous countries.

The transparency of existing business programs, compensation plans and operating procedures tends to increase the level of field involvement. While there will be some modification for local needs, if the overall model is similar to that being used by experienced field leaders in their domestic businesses, we should expect a higher level of participation because the guidelines for the new country will be within the comfort zone of the leadership.

This commonality adds to the ease of explaining the business in the new market. The similarities also add to the ease and speed of the duplication process and reduce or eliminate a comparison of the differences between the new and the home country's business methods.

Similar, but Certainly Not the Same

While the domestic company and the international company may share many of the same attributes, such as company name, products and selling method, there will also be some business practices that require change. It's important to recognize the need for country "fit" or localization when necessary.

The mission, values and fundamental pillars of the business are important to maintain regardless of where we operate. These speak to the essence of the business; they are our guidelines and clearly define the character of our company. But there are other elements of our business that need to conform to the tastes and the norms of the specific country to give us a chance at success. Adaptations may be as simple as using a different medium for our marketing materials, different product sizes, packaging modifications, and sample kit contents. For example, if the salesforce in country is more comfortable with hard-copy materials, such as flip charts, we need to provide more than just electronic versions on a Web site. If the "giant economy size" popular in our home market is not accepted in the foreign country, it would be better to conform to local tastes rather than try to change preferences. And if product and materials do change, what is the effect on the configuration and price of sample packs?

As we encounter these differences, we can either become frustrated or see them as opportunities to broaden our business, and perhaps even create a new and better approach to not only the new local business, but to our established business as well. Most differences can be reconciled, and with input from all the resources within the company, creative solutions can be found and implemented. Plus, creative problem solving in one country can serve as the basis for solutions to similar challenges in future ventures in other countries.

FIRE

Taking the time to assess a target market and be certain we have done our homework should provide us with a sense that the expansion initiative has a good chance of success.

The importance of being ready and fully prepared to open a new market cannot be overemphasized. If we are ill-prepared and launch anyway, the company's goals will be hard to achieve. Getting it right and being successful in the new market is the objective.

Taking the time to identify the specific challenges of a new market and utilizing the talents of a local, experienced management team allows us to aim at those challenges and resolve them satisfactorily, on the ground, every single day. This local, daily focus is a clear benefit to the parent company and to the new business.

With challenges identified and met, and with an experienced and well-trained local team in place, when the time comes to pull the trigger and fire off our best efforts in the new country, we should feel confident that the foundation is in place upon which we can build a successful business.

Jack Crowley is Senior VP of International Operations for Arbonne International. With more than 20 years in the direct selling industry, Crowley has helped develop international direct selling businesses for Mannatech, Avon/Betterware Joint Venture Businesses and Princess House Inc.

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