(Newswire.net — June 7, 2016) — Global trade has slowed considerably in the last few months. China’s economy is stagnating, despite extensive intervention from the Chinese government, and the Eurozone is struggling with a huge influx of migrants from the Middle East. Despite the current economic uncertainties, expanding into the global marketplace is the best way forward for many small businesses. However, it is not without its pitfalls, so if you are ready to go global, here are a few potential problems you need to watch out for.
Language Barriers
One of the biggest barriers to international trade is the language one. If you don’t understand the language, communicating with suppliers, producing documentation and devising marketing campaigns can be a linguistic and cultural headache. One way to ensure a successful translation project is to hire a professional translation company. It’s a lot better than using Google Translate.
Currency Fluctuations
It would be nice if the world operated on a single currency, but sadly it doesn’t. You need to plan for currency fluctuations when pricing up contracts overseas. In the event that currency values fluctuate wildly, your profits will be hit. It is also wise to account for currency exchange fees, as most banks charge hefty rates for transferring foreign currency payments into your local currency.
Time Zones
Time zones can play havoc with business transactions. If you live in North America and you are trying to set up a conference call with clients in Hong Kong, one of you is going to have to work out of hours.
Operating in different time zones can also be challenging if problems arise. For this reason, it is sensible to have at least one person managing the business locally. They can deal with local problems, such as disputes with a supplier, and if you need a rapid response in the event of a crisis, they can be on site immediately.
International Red-Tape
There is a lot of red-tape involved in selling products and services abroad. There is also plenty of regulation surrounding data and privacy protection law, so it is essential that you know the facts before you start trading overseas. Any mistakes you make from a legal perspective could cost you dearly. Get legal advice and make sure you stay inside the law when trading abroad.
Delivery Issues
Postal systems abroad are subject to different degrees of reliability: some work like clockwork, but others are corrupt and mismanaged, particularly if you trade with third-world countries.
Shipping items abroad is a headache in many ways, so expect there to be times when your shipments fail to arrive, or they arrive damaged. There is also a lot of paperwork to contend with when dealing with overseas suppliers and customers. It helps if you have experienced managers to deal with problems. Local managers are less likely to experience problems with shipments as they have the right contacts.
Expanding into the global marketplace is challenging but rewarding, as long as you do your research and manage the risks.