Globalization. A buzz word, to be sure, but a relevant and ever-present reality as well. Globalization is the past, present, and future of business. All of the Fortune 500 companies are multi-national with stores, offices, factories, and distribution centers strategically placed all over the world. The top executives frequently speak more than one language, and it is now the norm to have globalization courses in today's top higher education institutions.
But what does it mean for your business? How does a business thrive in this cut-throat global arena? With strategy. Strategy, purpose, and conviction.
This week Captain Dash flew to New York City to the National Retail Federation's NEXT 2013 Big Show. #nrf2013 The keynotes ranged from rallying retail leaders to innovate the retail industry to the role of retail in America's renewal to a particularly poignant keynote concerning the ways a business can expand and thrive internationally.
You can watch the keynote here : What it Will Take to Thrive in the Global Arena
The keynote features execs from Mango, Delhaize, and the Ebeltoft Group trying to answer the tough question about how to be a successful international retailer. They begin by addressing the basic requirements for international retaling:
- Dealing with national, regional, and local laws and restrictions (all the red tape involved in entering a new market)
- Accounting for new and existing competition in the new market
- Perfect supply chain strategies for these new and very different market conditions
- Understanding your local consumers and account for their particular tastes and norms
- Adjusting pricing, promotions, merchandising, and mix to adjust for market differences
- Real estate
- Transfering company culture and transfering the company expectations across oceans.
Now these are all concepts that any college graduate who has taken an international marketing class can describe. Yet somehow, there is not a single multinational company that hasn't made mistakes. Even this week, the Wall Street Journal reported on Walmart encountering problems with their Indian supply chain. The article cleverly tracked fruit on its way from small Indian farmers, going through unreal amounts of hazards and inefficient methods. So far, Walmart hasn't released any strategy to counterract these difficulties, but nonetheless, it's just one facet of a huge problem that plagues many international giants.
It seems that the true problem lies in doing all of these things, and doing them well. The Ebeltoft Group conducted a research study that attempted to quantify the key success factors of entering a new market -- turns out, all the key success factors studied were almost equally important to the success of a market entry... What that means is, there aren't just three or four things like competitive pricing or local adaptation or store locations that a company should focus on. Smart retailers really need to make sure they hit the mark in everything.
They keynote address, while being a little lengthy at a little under an hour, is extraordinarily telling, and is a real gem for any retailer to watch. Listening to the execs from Mango and Delhaize really brings home how complicated foreign market entry really is. But, we also realize that it's necessary. Retailing, much like other forms of business, has to go global, and with going global, a company has more stores, more websites, more Twitter accounts, more sales, and ultimately, more data.