Episode #21 - International Business Expansion Checklist with Cynthia Dearin

Eric Snow (0:11)

Welcome to this episode of the Business Beyond Borders podcast. My name is Eric Snow, and I'm taking over the podcast from the US. I'm an entrepreneur, I work in the beer industry, and a part of the IPA team here in the States. This is the last of four episodes. We've been talking with Cynthia about the questions people commonly ask about internationalization. In the first episode, we talked about the why. In the second, we talked about common mistakes people make. In the third, we talked about market research and why it's so critical.

In this one, we're talking about the checklist, which is the checklist of things you need to do before you get started. So Cynthia, thank you so much for having me on.

Cynthia Dearin (0:49)

Hey, welcome to my show, Eric. It's great to be here.

Eric Snow (0:53)

So Cynthia, in a few sentences, can you describe what the IPA is for people?

Cynthia Dearin (0:58)

Yeah, sure. So the International Business Accelerator is a structured program for business owners who want to take their company international. And there are three bits to it. There is a capability piece where we teach you how to build a very strong, foolproof international strategy. There is a momentum piece where we help you make sure that you've got it up and off steam to actually go out there and implement that strategy and make sure that, you know, you see it through. And we help you to create the confidence that you can actually do this project or international expansion so that you don't get stuck at some point because you feel like, oh, it's all too hard. Really quickly, the way we do that is that each month, we run a class for our clients where we work on a piece of strategy. There's a coaching piece where we meet one-to-one with each company and we help them to really craft their strategy and customize what they've learned in that workshop setting into something that will work for them specifically. And the third piece is that we pair up each participant in the International Business Accelerator with an accountability buddy.

And that accountability buddy is there to review their work, encourage excellence, and really keep them honest and give them a kick up the bum if they don't do what it is that they have committed to do.

Eric Snow (2:15)

So I've got your checklist right here. And it's thorough, we can't get through all of it, but let's talk about some of the things that are on it. So when thinking about things that you need to do as you start your globalization journey, one of them is, have we confirmed that all the decision makers are on board with the concept of expanding internationally? Why is this so important? And do you have any horror stories, I should say, of people who started and there was maybe one person who was reluctant?

Cynthia Dearin (2:48)

Yeah, look, I mean, it's interesting that you should mention it because it seems so self-evident. And if you're in a company where you're the only decision maker, it's not quite as important. Although, if you're married or you've got a life partner, I would highly suggest that you consult with that person and make sure that they are actually on board with a project of internationalization because it's a pretty big project. If you're fortunate enough to have a board of directors or other shareholders, then you absolutely have to make sure that they agree that taking the company international is the right thing to do because if you don't, you learned yourself in a world of hurt. We actually had a client who had started down the path of internationalization before. He remembered that he hadn't actually told his shareholders that he was going to do it. When he went and announced to them that he was planning to take the company offshore into Asia, they had a complete fit and they didn't want him to do it. It just created a great deal of division and stress and tension, and it just got the whole project off to a bad start because there wasn't unity within the leadership team about the project.

So everybody's got to be in agreement that it's a good thing to do before you start.

Eric Snow (4:04)

I could see the room for conflict to arise easily. So the next one is, will product appeal in the country we're targeting?

Cynthia Dearin (4:13)

Yeah. Now, this is really important because people often, the idea of internationalizing is very exciting. And it's easy to build this picture in your mind about how well it's going to do. And if you've got something, say, that sells on the west coast of the states and people like it and it's got some appeal, and you suddenly think about what that would look like if you sold it into China or into India, you can build these massive castles in the air where suddenly everybody in India is buying your product. But until you actually know whether people even want what you're buying, that is not a reality. Now, I can give you an example of a company that did this really, really well. It went out and researched the market that they wanted to go to, and the product that they were selling, and this company was Gillette. And back in the early 2000s, Gillette was mainly just selling in the states, I believe, and they saw a massive opportunity in the Indian market, which had something like three quarters of a billion men who shaved in it, who needed razors. And Gillette was like, yay, we're going to go and sell the Gillette Premium Razor into India, and it's going to be awesome, and everybody's going to want our razor. And they went, okay, well, before we do that, we're going to go and do some research and see if our hypothesis is actually correct. So they went off and they did a bunch of market research. And what they found out was that, yeah, everybody, all the guys of Shaving Age in India wanted to shave, but they were currently paying something like 15 cents a razor. And there was no way they were going to pay between $2 and $3 per razor for a Gillette Premium product. So they were like, oh, well, that's not going to work. That pricing strategy is not going to work. And we can't produce a Gillette Premium razor that is going to sell for 15 cents a razor. What will we do? So they actually stepped back, thought about it, went back in, did some more research, and they actually came up with a razor that was right for the Indian market based on the feedback that they had got from Indian guys who shaved. So they built a slimmed down razor with a light handle, you know, that was, that didn't have the same kind of quality and weight as an American Premium razor, but people didn't care about that. They took off some of the bells and whistles. They produced it for a lot less. And I think they ended up selling it for something like 75 cents a unit, but it was still better than the local product. Now, in the space of five or six years, Gillette actually cornered three quarters of the shaving market in India because they didn't get carried away with how great Gillette razors were. They went and actually found out what people needed, how much they were willing to pay, and then they built something that would actually meet that need.