New geography is a term often used to refer to emerging markets, new markets in which a business could potentially expand. While emerging markets does often refer to whole countries that are restructuring the way they do business to allow for new opportunities to do businesses, it can also mean smaller markets that are growing. Perhaps a sleepy town nearby is beginning to blossom and your business is considering the move into it. Before you do make that move, there are numerous areas your business needs to focus on to determine if such a move is a good decision for the business.
4 Areas to Focus on
There are four particular areas your business will want to focus on when considering such a move, whether it is into a new country or just the next county. The key is to be fully aware of what could happen and to plan for opportunities to avoid problems. The four key areas are:
- Political Aspects
- Economic Conditions
- Social Aspects
- Technological Aspects
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Political Aspects to Focus on When Moving into a New Geography
The first of the concerns are politically based. In short, you need to know about aspects such as how the government intervenes within the economy of the location. In some cases it does this through law and in others it is through environmental controls. Here are some things to think about in this specific line of thinking.
- What environmental regulations are in place within the area that could hold you back?
- Learn of the tax policies in the new area and what these can mean to your business itself.
- Find out about any trade regulations that may be present, especially if you are dealing with international situations.
- Consider employment laws in the area and how these may affect the way you hire and manage your employees.
- Find out about government organizations in all. In some communities, new businesses may not be tolerated well or may have significant steps to take before being able to do business there.
- Learn about the political stability of the area, especially in international situations, as this can control how well your business fits.
- Consumer protection laws and considerations are also important to take notice of in most situations.
The political aspects of any emerging market are important to know. Learning about the location is never a bad idea, of course, since it gives you a clear indication of what could be expected.
Economic Conditions to Focus on When Moving into a New Geography
Another factor to consider when moving to new geography is the economic climate. Again, both international and domestic moves here need to be focused on. Consider the following specific areas to look at.
- What is the economic growth of the new area? Is it growing? Is your business going to be able to take advantage of such growth?
- What are the economic conditions that may affect you in a secondary way, such as interest rates?
- Find out about unemployment. Are there too many people unemployed and thus your customer base is smaller or is it hard to find employees to hire because unemployment is very low?
- What about taxation? What rules are in place and what limitations does this pose to your business?
- Find out about government spending, especially in international cases. Knowing what government spending can or cannot offer is important.
- Find out about consumer confidence, too. If you are planning to open a business where the only other businesses trusted in the community are big box stores, it will be hard to compete.
Look at all aspects of economic conditions especially in the international sector. Consider things like the stage of the business cycle and the exchange rates, too.
Social Aspects to Consider When Moving into a New Geography
Your business needs to explore the social aspects of any new geography before moving into this arena, too. These social aspects are critical including the following:
- What is the income distribution within the new area? For example, is the location a very low income community with limited disposable income? Is there a strong middle class present?
- What are the demographics of the area? Do the demographics support the type of business you wish to introduce into the sector?
- What about lifestyle changes that your business can promote? What lifestyle changes will your customers need to make to use your business?
- What is the education level of the community? In some types of businesses, having a higher education level in the community is necessary to ensure the business can succeed.
- Focus on the trends occurring within the community, too, such as health and social communications.
The more information you have about social climates in the new geography, the more likely your business can succeed there. That is because it will fit in properly.
Technological Aspects to Focus on When Moving to a New Geography
Technology is a big deal no matter where you plan to move. Consider the following aspects and how they relate to your business.
- What are the technology limitations, if any, within the new area?
- What energy usage and costs are present that could hold your business back from being successful?
- What changes will your business need to make in IT usage, Internet usage and in mobile technology?
- What governmental regulations are in place that may limit technology?
Technology is something every business uses today. Thus, if you are moving into a new geography with your business, you need to ensure there are options for helping your business to grow or to just function as you would expect it to function where it is right now.
Emerging markets around the world are different. It is quite important to utilize a total exploration of these factors if you are moving into an international market. Take a look at all of these factors before you decide to invest in the move. No matter how big or small your business is, it can prosper in the right economic conditions if you do your research in advance and focus specifically on the goals you have. Most businesses can see significant profit improvements when they move into new geography after planning to do so.
