A distribution agreement with a reseller or agent does not guarantee that business will flow as a result. You need to constantly work the relationship – and this means regular communications, visits, ongoing technical support and training and a steady stream of marketing initiatives.
Another way to expand your market presence is by setting up a representative office, branch or subsidiary in the target country.
Before making such commitments, contact Austrade for advice and referrals to local service providers that can assist your entry into particular countries. In-bound investment organisations such as JETRO and UK Trade and Investment – which both have a presence in Australia – offer a range of support for foreign companies setting up in their markets.
Your local representative is an important part of your market expansion strategy. Although you may initially consider sending one of your Australian team to the target country, unless this person is already well connected locally and conversant in the local language, this strategy may have limited impact.
During the tech boom, many Australian companies sent executives to Silicon Valley to establish a local subsidiary and break into the US market. Although this is still occurring to some extent, the technology sector downturn now means highly-skilled marketing executives from the US can be engaged at moderate cost. These people have strong local networks, industry knowledge and good management experience.
Specialist IT recruitment agencies, similar to those in Australia, operate in major markets and can identify candidates if you are employing locally. Alternatively, sources such as business networks, newspaper classified advertising and even customers can be used to find good staff.
If you are only employing one person, a sales engineer is generally best, as this one person can normally handle both marketing and technical issues.
Whether you employ a representative locally or work through a local partner, training in your product or service is essential. Unless your representative is fully conversant with the technology, they will not be comfortable selling it and may not achieve expected sales levels. Bringing overseas employees or partners to Australia for training is highly recommended, if time and resources permit.
Technical support is also essential and becomes a particular issue if you are operating in diverse time zones. If you do not operate on a 24x7 basis, an ability to respond to technical inquiries within one to two working days is important to secure overseas business.
If you are setting up a test or pilot site for a new overseas customer, you will need to factor in the cost of deploying a technical team from Australia to oversee the installation. If problems occur later, telephone support or remote systems monitoring can help rectify any technical issues. But if this fails, technicians may need to travel to the customer site at short notice to physically inspect and fix the problem. In some cases, you may be able to outsource technical support to a local service provider.
If you decide that you are not ready to set up a complete international office, there are several things you can do to build the appearance of a local office without leaving home.
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Website: drop the .au from your domain name in favour of a global top-level domain (.com or .net) or a local country domain (such as .co.uk, .com.sg, .com.hk, .co.jp, .ca, .fr or .de) to help internationalise your website.
- Email: Electronic messaging is a great way to break down the time zone issue. You can send an email during your normal business hours and replies can come back while you are in the office or away for the evening. Some time zone differences allow you time to resolve issues ‘overnight’ for the customer during your own office hours.
- Toll-free international number: In many markets, telephone companies can offer a local toll-free (1800 or 0800) number that diverts through to your Australian number. Your prospects then only need make a local call to contact you. But make sure you remain savvy about time zones: if your support centre or sales office is not staffed 24x7, ensure you at least have a voicemail message advising that you will return the call within a specified timeframe.
- Videoconferencing: This is another way to communicate with partners and other teams you are working closely with – although it tends to be rather too impersonal for effective sales calls.
- Serviced offices: Most countries have companies that provide serviced offices for international companies. They can forward mail and act as a receptionist service during local business hours, as well as providing a base for meetings and working when you are visiting local customers. Be aware, however, that in many jurisdictions you may be liable to comply with local laws if you are operating through a serviced office, even if you are not physically present.