The coronavirus pandemic continues to throw a perpetual spanner in the works for Australian businesses, but despite these challenges, there are still plenty of opportunities for growth says Vijay Raghvani, Head of Customer Experience at Airwallex.
If you’re wondering whether the midst of a global pandemic is the right time to grow your business, you’re not alone. Yet Raghvani suggests the coronavirus crisis has also presented businesses with opportunities as they pivoted to survive.
“It’s a fair question,” says Raghvani. “Growing a business requires time and resources. You might feel everything you have to give is focused on keeping your business afloat, navigating snap lockdowns and myriad restrictions, rather than growing into new or unknown territories.
“However, in times of change or uncertainty, it’s important to not sit on the sidelines. Think of expanding into new markets as the next step in how your business is transforming and responding to the new world, building on the shifts your business has already made in response to COVID-19”
Some businesses have experienced a boom during lockdown, Raghvani suggests for these small businesses, expanding to new markets could also hasten growth.
“In simple terms – entering new markets can boost the growth of your business. Even if you’re performing well, the Australian economy is only one small piece of a global market. Expanding overseas will open the door to new opportunities, not only to create new revenue streams but also help create a buffer for your business during times of uncertainty.”
Raghvani says cross-border eCommerce is a great example. In 2021, over half (57%) of all global online shoppers made a purchase from an overseas retailer, with global eCommerce sales hitting the US$4.5tr mark. After all, having an online presence means your customer base is already global.
“If you can get the product or offer right, customers won’t be deterred by where it comes from. In fact, we are finding that the world is loving Australian products – whether it’s Canva or Crock’d, Australian businesses have a great reputation in the global marketplace.”
So how can you tell if your business will work outside Australia? According to Raghvani the answer lies in research.
“Too many businesses launch in a new region with replica campaigns, messaging and customer expectations to their home market. While this is the quickest way to enter a new market and you may make an initial splash, it’s short-sighted and unlikely to result in long-term success.
Even products that feel universal in appeal, such as clothing or cosmetics, need to be carefully tailored to the target market. As with any business move, research is the best place to start”
Three tips for a successful expansion
Examine competitors in the region
Is your business’ product or service already available in this market? If yes, what sets you apart from those already in the market? Is your offer compelling enough? Have others come before you and failed? What can you learn from their experience to increase your chances of success?
Analyse the data you already have
Business insights don’t need to come from external sources alone. Use feedback from your current customer base to anticipate the needs of your target market. How can you streamline and personalise your services based on customer feedback you have already?
Pinpoint your value
Your USP in Australia may not be universal in other markets. Unpack what is the most attractive aspect of your product or service to consumers in that market.
And remember, while you might be adjusting your business for a new market, it’s important not to lose the core value of who you are and what you are doing.
While many business owners might think they need boots on the ground to successfully launch their brand to an overseas market, Raghvani says this is not always the case.
“You may ask yourself, how can I run my business in a country where I don’t have any staff, or speak the language, or have a bank account to pay suppliers? It’s a big job setting up shop abroad.
“The good news is in 2021, you no longer need your own boots on the ground. The pandemic has proven that face-to-face interactions aren’t imperative to doing business in Australia, and this premise applies to the global scale.
Raghvani suggests you should start by recognising what you’re good at, as well as where your limitations lie.
“The biggest misstep SMEs take when crossing borders is trying to do it all themselves. Use local resources for that last mile. Partners and suppliers exist in their dozens ready to pick up any potential roadblocks.
“Payments is a practical example (and one that I’m passionate about). Getting it wrong can be costly. Too often, businesses focus on the end goal – selling – without considering the other parts of the payments processes. Any success and early wins are swallowed up by the costs of collecting, transferring and paying out money in the different currencies. One of our clients, Melbourne-based retailer Orbitkey, experienced this firsthand when they were caught offside by international transaction rates when dealing with global wholesalers, paying as much as $AUD37 on every transfer.
“Shop around to find a trusted partner or supplier to deliver cost-effective solutions that free up your time to focus on growing the business.
Asked what’s the most common hurdle businesses face when launching in a new market, Raghvani has this reply:
“Cash flow is a constant challenge for all small businesses, particularly during these turbulent times when you can be forced to shut shop at short notice. Cash flow becomes even more critical when you’re aggressively pursuing growth.
“Solid forecasting is really important in terms of managing cash flow. But where to begin, with so many variables at play?
“In my view, always start with the customer – cash flow is synonymous with customers, for, without customers, there is no cash flow! I always centre my forecasting models around the customer. For example, how many new customers do you need each month/week? How much are you expecting from existing customers? How easy is it for your customers to pay you? If you offer credit terms, what is the time between invoice and cash? What is the cost to move your money?
“If you are as valuable to your customers as they are to you, it translates to improved cash flow for the long-term. Set a goal to be more valuable for your customers than they are to you.”
If you’re keen to learn more about how to expand your business to new markets, Airwallex and Naomi Simson have joined forces to provide resources for small businesses.
Want more? Get the latest coronavirus news and updates straight to your inbox! Follow Kochie’s Business Builders on Facebook, Twitter, Instagram, and LinkedIn.
Now read this