We’ve all heard the budding if not slightly annoying candidates on the Apprentice tell us all that their existing consultancy business, which has only just started trading, is ready to go global and that they just need a few words of wisdom from Sir Alan to be on their way.
Most of us don’t live in a TV programme! For some, the road to grow from local to national business and then eventually to being a global player can be a long and winding one. Others will start with a global proposition and the desire to expand internationally right from the beginning.
So what is the key to growing a business outside its domestic market? It is useful to learn from some of the strong UK businesses that have made big attempts to build a global footprint. Many have found that what works in the UK may not work abroad and hard lessons can be learned from the likes of Marks & Spencer and Dyson.
M&S expanded into the US but rather than using the M&S brand they purchased Brooks Brothers, an existing US clothing retailer, for $750m in 1988. Fast forward 13 years and M&S had to sell their US business for $225m with an estimated total loss on the adventure of £1bn. Whilst a number of good reasons have been put forward to explain this failure, for me the fundamental problem was that they couldn’t replicate their much loved UK brand in the US particularly when expanding through a different business.
Compare that with Dyson. The Dyson vacuum cleaner is a product that helps solve a problem that everyone experiences and as a result the business was able to create a message and brand that could easily translate into different cultures and languages.
Businesses that are very successful in their home market often have a fear of failure, preferring not to look beyond their borders and instead to ‘stick to their knitting’. However, businesses are far more likely to have longevity and sustainability if they expand into new markets and in Jersey we see both those that choose the long path and others that are international from day one.
Don’t think that because your business is currently serving a local market you can’t sell off island. Jersey has a long history of export success, from ships to knitted jumpers and more recently to Jersey Royals and Jersey Dairy products. Interestingly all these exports are or have been premium products with clear market demand and a clarity of ‘brand’ that enables them to easily transfer across different cultures and languages.
Don’t think that you can’t export if you are a service business, just look at financial services, Jersey’s biggest value export. Whilst this sector covers a wide range of business services, from an exporting perspective our strengths are on delivering services that support private wealth management including global investment fund administration. As with product exports, we are very targeted on what we do and our services are considered to be premium.
So how does a local business with a great product and service expand beyond Jersey and achieve success off island?
Rather than trying to achieve global domination my advice is to focus on clarifying your existing unique selling point (USP) and identifying where that USP can transfer across cultural and language boundaries. You can then start researching one or two specific new markets where your product or service has a potential customer base and where you can work with a partner or adviser who has experience to help you access that region.
At Jersey Business we recognise that such a journey is challenging but by working with our own knowledgeable partners and sharing best practice we know there are real growth opportunities for Jersey businesses.
To help we are currently setting up a Jersey Exporter Club where exporters can share best practice and access more support, be that from our own Jersey Business Advisers or through better links with global trade contacts. Have a look at www.jerseybusiness.je/get-advice/exporting for more information.
Given the power of the internet and the ability to reach global markets there has never been a better time to look to export. Conversely, the internet also enables global competitors to compete in your local market so simply ‘sticking to your knitting’ may well not be an option!