Five Benefits of Internationalizing Your Business
Spanish companies are exporting more and more and are optimistic about their international turnover.
According to the Spanish Ministry of Industry, Trade and Tourism, Spanish exports of goods rose by 1,6% between January and October 2019 compared to the same period in the previous year, above countries such as Germany (1%) and the United Kingdom (-0,5%), but below the EU average (2,4%), France (3,7%) and Italy (2,7%).
IBEX companies earned 66% of their income abroad, but SMEs also increased their international sales. In the case of the latter, exports accounted for over 36% of the turnover of exporting SMEs in Spain.
The reduction of trade tensions and the growth of external demand had a positive impact, but exporting companies also point to the good quality of products and the hiring of human resources specialized in the field of internationalization as further reasons for this increase.
Among the negative aspects, both international price competition and raw material prices stand out.
But what encouraged these companies to internationalize? When did they overcome their fear of expanding abroad? And what made them change their mind? It was probably due to one of the following aspects.
Benefits of Internationalization
- SME growth: it has been proven that companies that establish activities abroad increase both their turnover and their short-term and long-term benefits fourfold, as they sell more goods and services. Furthermore, they avoid being taken over by larger companies.
- Increased competitiveness: by selling beyond one’s borders, the market size is greater, but so is the level of competition. This forces businesses to boost productivity by reducing costs and increasing innovation. It is necessary to offer goods and services at a better price and with a higher quality than competitors in the country of destination.
- Risk diversification: should a crisis arise, businesses will not depend exclusively on the situation of a particular country if they operate in several markets. Therefore, if a country is experiencing recession, bankrupt probability will inevitably be higher than if goods are being sold in different markets. In other words, the crisis in some countries will be offset with the good situation in others.
- Enhanced brand image: selling in other countries involves greater international recognition, that is, a higher number of consumers that have your brand in mind when they purchase goods. In addition, exporting requires courage and determination to tackle unknown markets, but it also involves effort and guaranteeing the quality of the necessary goods and services in order to succeed in them.
- New opportunities in emerging markets: growth in less developed markets entails an increase in needs. Taking advantage of these opportunities will result in an increase in revenue for your company.
Take a moment to think about these five points and decide whether you want your business to grow and be competitive without selling it to a larger company (probably a multinational corporation) or whether you want to keep it as it is: healthy but lacking growth prospects.
A new crisis is coming, and while its consequences cannot be anticipated yet, the more prepared you are, the better.
Throughout this process of internationalization, you will likely need the help of a trustworthy translation agency. An ally that will get your message across in other languages. CLAK will guarantee that your website and the texts that target other markets are well-positioned and will reach more potential clients.
Let’s have coffee and talk!