Growing a company into a global powerhouse is every CEO's dream; however, the operational processes that worked in the past may not effectively scale to a global level. No two countries are alike, meaning there is no magic bullet for supply chain or e-commerce solutions that will work across the board. With proper preparation, however, you can successfully navigate new markets.
If a global expansion is on your company's horizon, below are six key areas to consider.
Each country has its own set of Value-Added Taxes (VAT) as well as import and export tariffs that, if not managed correctly, can bring your entire supply chain to a grinding halt. Work with a partner who has the knowledge of specific tax laws, or you could find yourself wasting valuable time negotiating tax hurdles instead of bringing your product to market on time.
2. Local customs
There are a myriad of cultural differences that need to be navigated in order to keep from confusing, or possibly offending, your new group of consumers. Everything from product names, to labels and e-commerce sites need to be properly translated, vetted and signed-off on by the company and by regional representatives, to make sure that both sides are happy and that the product will present and sell effectively.
While this might sound basic, the ability for your e-commerce solutions to accept the variety of currencies around the globe is critical for success. Being able to accept, exchange and properly transfer money between countries, while complying with global trade regulations, can be overwhelming for emerging brands. Solution providers operating on a global scale can easily plug-and-play this functionality into an existing e-commerce shopping cart, saving you the hassle, time and money of retooling your current site for each currency.
4. Labeling Requirements
Each country comes with its own set of labeling requirements and disclosures. For example, certain countries have requirements for packaging to include the cost of the item, while others allow it to be on a separate label. Local stores and chains have specific UPC and labeling requirements, not only for displaying the product on shelves, but also for them to be able accept shipment of product in the first place. Taking the time to learn each and every retailer requirement can be an unnecessary expenditure of time and money for a brand. Instead, pairing with a 3PL provider with a proven track record can streamline the process and keep hiccups from occurring in the last steps of the supply chain.
5. Recycling, disposal and recovery regulation
Countries vary in terms of what materials they allow to be used in products, as well as put into their waste streams. While one country might have established regulations for e-waste recycling and recovery, others may require those same materials to be landfilled. With regulations come standards for advisory signage and labeling to be incorporated not only into packaging, but often directly onto the devices themselves. Having a partner that is familiar with each and every region's material disclosure and disposal regulations, along with the ability to customize packaging and products at a regional level, can eliminate confusing and overcrowded information on packages which try to convey all the applicable regional requirements on a global level. Last minute customization by a capable 3PL allows for product and packaging to present a clean aesthetic, while still adhering to regional regulations by including only regionally relevant information.
6. The last mile
While worldwide carriers offer a great array of logistics services, the ability to coordinate with local transport and warehousing assets can mean the difference between having additional product in country just when a retailer or e-commerce customer requires it, and having to spend days or weeks getting additional inventory in country. A truly global 3PL provider can leverage existing relationships with local providers to maximize efficiencies in local shipping and storage through economies of scale, by leveraging multiple brands' inventories to secure lower rates. These savings can then be passed down the chain to reduce the cost of supply chain and logistics operations for each individual brand.
Global expansion is a great way to grow an organization. However, ignorance of the laws and customs of other markets can be a deal breaker. Tell us about the lessons your organization has learned in the comments section below.