The Advantages of Small Business Trying to Enter International Markets


It is now easier to reach international markets thanks to advances in communications and transportation systems. A small business benefits when it takes advantage of the worldwide availability of potential customers with needs and money to spend. Although there are risks involved, the financial or competitive benefits that foreign markets can provide for small businesses are often worth consideration by all stakeholders in the corporate world.

Long Life for Products

A product’s life is limited and it undergoes difficulties in sales and distribution between its introduction and decline. When you introduce the product into the international market while the product’s appeal is declining in the domestic market, you get more time to sell the product. For instance, you may introduce a laptop model in the United States starting in January, then in December, when its sales decline because of newer models, you may launch the first model into Asia, where sales will be high until its appeal wanes.

Increase in Sales and Profits

When you engage in international trade, your business will experience increase in sales and profits, although this also depends on other factors such as marketing strategies, the quality and success of your product and trade restrictions. The US government recognizes the potential of financial growth and job creation by small businesses exporting to foreign markets and is trying to help them reap profits abroad. Thus, under the Jobs Act, small businesses exporting products can get an increase in loans and advocacy services to strengthen them for maximum benefits.

Knowledge Gain

The international market can help you and your employees gain knowledge of foreign business practices, which you can apply to improve your local and overseas businesses. For instance, you can gain insight on latest marketing ideas, technologies and new products other companies are offering. You can use such knowledge to develop better products and sell them more effectively and eventually improve the image of your company at home and abroad.

Risk Diversification

When you export your products to international markets, you reduce your company’s dependence on existing markets and enable your company to diversify risks. Your business is able to evenly distribute risks such as economic recession and seasonal fluctuations in the market when it expands to other countries. For example, the business may not suffer much loss when the local market experiences a depression because the foreign markets will cushion it from total collapse.

Market Share

When small businesses venture into the international market, they gain global market share and contribute to America’s international commerce, according to Sen. Mary Landrieu, chair of the United States Senate Committee on Small Business and Entrepreneurship. Global trade enables your business to expand its customer base, thus enhancing its capacity for corporate expansion in the long term as a result of the potential profits. The expanded market will enable your business extend the sales potential of existing products and allow you to sell excess production capacity.

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