The dangers and opportunities of moving into foreign markets

Why it pays to do your homework

Nearly six months after expanding his business offering tailored information technology solutions to the financial services sector, Misha Gopaul is pleased with the progress of the venture. But he confesses that he has been surprised by the form the success has taken. “It’s gone completely different to how we expected it,” says the chief executive of London-based Fabric Technologies.

For example, the company – which has seen turnover more than double to nearly £8m in the four years to 2009 – planned to start out in Zurich before expanding into Geneva. In fact, it has done it the other way around through responding to information picked up locally. “It pays to be flexible,” says Gopaul.

Fabric, which was partly prompted to make the move by the fact that some of its customers were setting up operations in the Swiss financial centres, was from the start concerned about keeping within a tight budget. Thanks to its expertise in technology, it is able to do a lot of the work from London. It has also outsourced some routine tasks to local partners.

Fabric also used some of the strong relationships it has developed with some of the IT industry’s biggest players, such as Cisco and Microsoft, to obtain local knowledge of the market and to acquire contacts.

This sort of pre-planning certainly fits with the advice offered by such business figures as the serial entrepreneur Sir Eric Peacock, Lord Digby Jones, the former CBI head and former trade minister, and Kanya King, the founder of the Mobo music business, at a recent round table organised by HSBC commercial banking (see "HSBC Tips For Success" below).

Certainly, Brent Hoberman and his team at the interiors website MyDeco.com have prepared for expanding from the UK into the United States by doing their homework. Drawn by the fact that the US home and home furnishings market is reckoned to be worth more than $120bn (£80bn), they are planning to offer 15 million products and to deal with more than 1,200 retailers – making the site substantially bigger than its UK parent, which was established two years ago.

Hoberman says he was originally attracted to the market when furnishing the house he bought after the sale of lastminute.com, the online travel company he co-founded, at the height of the dotcom boom. He saw an opening for a business that – as he sees it – “democratises design”, giving ordinary consumers access to the same sort of things as the professionals. Increasing US interest in the site has spurred the latest venture.

He acknowledges that it is hard going into the United States, traditionally the graveyard for many British retailers, but the early response to the launch has been encouraging and he hopes that technological advances, such as a 3D room planner and an active social networking community, will provide it with an advantage.

At a time when growth is hard to come by, going international has at least to be considered by any business looking to prosper in the coming years. Moreover, as Noel Quinn, HSBC’s UK head of commercial banking, says, all exporting is good for the UK economy.

HSBC Tips For Success

1. Use every piece of advice available to you, every advisory body, your networks, customers, suppliers and peers to build your knowledge and obtain the introductions you need overseas.

2. If you are looking at overseas markets for the first time, stay initially within your comfort zone by going somewhere familiar or where they speak the same language.

3. Before taking on outsiders, look at how your own people can drive effective internationalisation. They could be great ambassadors.

4. Do your homework before entering a new market. Before you make the leap, it is possible to do a lot of research on the internet, through organisations such as UK Trade & Investment and Chambers of Commerce, and with your bank.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
Voices
There will be a chance to bid for a rare example of the SAS Diary, collated by a former member of the regiment in the aftermath of World War II but only published – in a limited run of just 5,000 – in 2011
charity appealTime is running out to secure your favourite lot as our auction closes at 2pm today
News
people
Arts and Entertainment
Bianca Miller and Katie Bulmer-Cooke are scrutinised by Lord Sugar's aide Nick Hewer on The Apprentice final
tvBut Bianca Miller has taken on board his comments over pricing
News
Elton John and David Furnish exchange marriage vows
peopleSinger posts pictures of nuptials throughout the day
PROMOTED VIDEO
News
File: James Woods attends the 52nd New York Film Festival at Walter Reade Theater on September 27, 2014
peopleActor was tweeting in wake of NYPD police shooting
Sport
Martin Skrtel heads in the dramatic equaliser
SPORTLiverpool vs Arsenal match report: Bandaged Martin Skrtel heads home in the 97th-minute
News
newsAstonishing moment a kangaroo takes down a drone
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

SThree: Graduate Recruitment Consultant

£20000 - £25000 per annum + OTE £35000: SThree: SThree are a global FTSE 250 b...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K - £45K: SThree: SThree Group have been we...

Day In a Page

Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all
The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
The 12 ways of Christmas: Spare a thought for those who will be working to keep others safe during the festive season

The 12 ways of Christmas

We speak to a dozen people who will be working to keep others safe, happy and healthy over the holidays
Birdwatching men have a lot in common with their feathered friends, new study shows

The male exhibits strange behaviour

A new study shows that birdwatching men have a lot in common with their feathered friends...
Diaries of Evelyn Waugh, Virginia Woolf and Noël Coward reveal how they coped with the December blues

Famous diaries: Christmas week in history

Noël Coward parties into the night, Alan Clark bemoans the cost of servants, Evelyn Waugh ponders his drinking…
From noble to narky, the fall of the open letter

From noble to narky, the fall of the open letter

The great tradition of St Paul and Zola reached its nadir with a hungry worker's rant to Russell Brand, says DJ Taylor
A Christmas ghost story by Alison Moore: A prodigal daughter has a breakthrough

A Christmas ghost story by Alison Moore

The story was published earlier this month in 'Poor Souls' Light: Seven Curious Tales'