The term “reality check” can often feel a little hostile and confronting, because usually, we go through them without our say-so. They happen to us when we’ve made a mistake, or when someone needs to forcefully give us an alternative point of view to fix an error.
However, it’s also quite true that reality checks are something we can process ourselves. That’s a useful perspective to have in a business context, because if you can clearly review your decision-making process, priorities and possible blind spots before making a huge decision, well, it could save you from a big mistake.
There’s perhaps no greater example of this need than when expanding your business abroad, or at least considering such an effort. That’s because an error made now can continue with you for some time.
Let’s consider what reality checks may be needed in such circumstances:
1. Preparing & Ensuring Your Financial Ground
You need to make sure your finances (and not just your budget) are watertight before investing in this process, which means being clear on how you’re going to handle spending, payroll, invoicing, taxes that don’t follow the same rules, and which accounts are tied to which processes. If you can’t answer those things cleanly, then the expansion isn’t ready yet.
One of the easiest wins early on is to open business bank account online in the country you’re moving into, just to make sure you’ve got something local to work from. Otherwise, you’re left patching things together across different systems, which just builds delays and confusion.
2. Conducting Thorough Market Research & Matching Cultures
You may think your successful brand in one country will work the same way somewhere else, but that’s almost never the case. For example, if you’re used to a casual, informal customer service tone but you enter a market where formality is expected, then right from the start, you’re going to come across as out of place. Little mismatches might be okay and even charming (companies like IKEA still have their Scandinavian charm), but it’s important ot be mindful about how your communication style will define you in a new place..
We’d recommend that you talk to people who operate in the region, work with local teams where you can, and respect that different places run on different assumptions, and you’re not going to spot those without understanding your market research and being certain of the space you’re trying to fit into and how.
3. Balancing Cost & Opportunity, As Well As Opportunity Cost
Every new expansion sounds like progress, but it takes time away from what you’re already doing, and so opportunity cost is a huge part of pulling the trigger on a major decision. That’s not always a problem, but it can become one if you haven’t worked out what’s going to slow down in the meantime, or what kind of attention the new setup will demand every day once it’s live.
The bigger the opportunity looks, the easier it is to forget how much of the current business could be affected. So consider the full extent of what reallocating resources might look like as you get set up in a new place, it does matter.
With this advice, we hope you can more easily go through some essential reality checks, even with a big expansion planned!
