Growth often requires confronting the fears we have about change. Kodak does not innovate until it is too late. Enron waits until the media cameras are rolling to start figuring out what happened. Famous companies are often hampered by their fears, and so they are not prepared when an emergency strikes. Their fears become a self-fulfilling prophecy.
One of the common fears that many people in the United States have is international environments. The “Made in USA” label has become a popular symbol of the xenophobia that we share. However, such ethnocentrism does not hold up under scrutiny. Over 95.66% of the world lives outside the United States. That is 95.66% of potential customers that domestic-only companies are ignoring.
To access that market, it helps to remember some of the benefits of doing so:
- Greater Customer Population Means Higher Revenue – If you help people internationally, you will have higher revenue. Apple made the iPhone in Taiwan and is still one of the world’s largest companies because of that cost effective decision. Manufacturing products in low-cost labor countries like China have high benefits. More of your revenue will be profit, less will be expenses.
- International Companies Will Attract Immigrants at Home – If immigrants have seen your brand in their home, they will likely continue to buy it when they live in your country. An example would be such internationally known brands as Kentucky Fried Chicken (KFC) and McDonald’s. You will benefit at home from having an international presence. Influence & persuasion training programs are helpful for convincing the skeptics in your organization.
- Low Taxes – Relocating your company headquarters in another country can significantly lower taxes. Although many businesses are hesitant to try it, the U.S. government severely sanctions those who stay rooted in the American market through high taxes and regulations to business operations. If you relocate your corporate headquarters in another country as a foreign corporation, taxes will be lower.
A good example of this is Blue Coat Systems. The cybersecurity company over the last decade has expanded its operations to more than six different countries. This has helped to both make the business more profitable and more widely respected in the security sector.
- Low Labor Cost – Foreign workers in some countries require fewer benefits and lower pay. You will be saving on this crucial expense. They will not be hurt by it, for the cost of living overseas is also disproportionately low. You have everything to gain by hiring a foreign workforce.
If these things are not convincing, think of the advice from billionaire Warren Buffett. He says his basic investing strategy is to avoid what others love, and love what others avoid. Make a list of the things that your competitors are avoiding. Things such as foreign markets, costly moves, learning, foreign languages, suffering, high prices, new permits, moving, change, weird, ugly, dirty, dangerous, or violent. If you eagerly pursue these things, you will find opportunities that most are missing out of prejudice.
Also, make a list of what your competitors are eagerly loving. Things like domestic markets, cheap moves, teaching, native language, pleasurable, low prices, old permits, staying, normal, beautiful, clean, safe, or peaceful. All of these business market behaviors have lots of competition, and high expense to remain in them.
Ideally, as a business, you want to be buying the unpopular things, which have a low price and selling the popular things. Your business is a function that should convert unpopular into popular. Apple saw that its competitors were afraid to go overseas to a strange island east of China. Steve Jobs went there and contracted with Foxconn to build little computers that could also serve as a phone. The rest is history.
The iPhone is a popular digital business platform. Apple became one of the world’s largest companies on sales of the iPhone. Their company was fulfilling the ideal model. It was turning unpopular things into popular things. They made a high profit. Give them this data.
Your business can do so as well. Many companies have a popular into the popular model. This limits their profit. It increases debt and expenses. If you want to become a cash surplus company, the international sector holds the secret to your success. Try something new, and you will not regret it.
By: Dennis Hung