International business expansion: Your guide

What is international business expansion? It’s the process of growing your business operations abroad to establish a presence in foreign markets. This guide shows how it can be a powerful driver of success for businesses of all sizes. Discover the key steps involved in an international growth strategy and access resources to support your entry into the global market.

Are you facing market saturation or looking to increase your growth potential? If so, it may be worth thinking about. Expanding internationally can give you a competitive edge by opening the door to new revenue streams and clients. And beyond the financial benefits, it can also help your organization mature and become more resilient.

Canada’s population is a fraction of a percentage of the world’s population. So, if you look beyond our borders, that’s a lot of people who need a lot of things. Everyone needs somewhere to live, food on the table and clothes to wear. People also want extras on top of the bare necessities. 

According to the World Bank, global consumer spending adds up to more than 100 trillion Canadian dollars a year, which is 48 times what’s spent in Canada. So, opening the door to international markets could offer an opportunity to earn additional revenue and reduce your dependence on a single market.

This could then make it easier for you to leverage economies of scale in areas like procurement and marketing. For example, some suppliers offer volume discounts. 

Even your investments in research and development (R&D) could go further in some cases, since spreading the cost over more products can offer a better return on capital over a shorter period. 

There could also be big non-financial benefits to expanding outside of your domestic market.

• Operating in foreign markets could make your company more resilient to disruptions that might only affect your home country—like economic downturns, new regulations or increased competition.

• Going global could also increase your access to a much larger talent pool, especially given Canada’s strong reputation. If you’re facing a labour shortage, this additional access to talent could be really helpful, giving you an opportunity to tap into skills, technologies and business practices you may not have seen before.

• If you want to grow your business internationally, it’s a good idea to have a solid business plan, an international business expansion strategy and serious operational discipline. Happily, this can help make your company stronger, even domestically. Why? Because it often entails an in-depth review of internal processes that can improve productivity and help sharpen your long-term vision for the company.  

Having an international business strategy is all about setting a clear, measurable and realistic business goal. Taking a careful approach helps you identify opportunities for business growth while taking possible risks into account.

Here are four key steps to help guide you through the process.

Succeeding in a new market means learning the rules of the game—and those rules aren’t the same everywhere. You’ll need to familiarize yourself with the local economy, customs, consumer habits and the competitive landscape.

Public data like GDP growth, inflation rates and household spending can give you a general sense of the business environment. But to really understand the market, it’s a good idea to dig deeper through market research, competitor analysis, in-depth studies and even on-the-ground interviews.

Be sure to ask the right questions, such as: 

• Is there real demand for your product or service?  

• What do your potential customers expect? 

• Is the competition firmly entrenched, or is the market hungry for something new? 

• What does the sociopolitical landscape look like? 

The answers to these questions can help you decide whether your expansion plan is feasible or not. They’ll also help you choose the right market if you haven’t narrowed it down yet.

As successful as your business might be at home, you can’t just cut and paste that success elsewhere. You’ll want to be open to tweaking your products and your marketing strategies based on a different climate and regulatory environment, and new-to-you tastes, cultural nuances and values.

As an example, electric vehicle manufacturers who wanted to break into the Canadian market quickly realized their products would have to be able to handle our harsh winters—including extreme cold, which affects battery range, and freezing rain, which can block the charging port.

Some other things to consider are your communication channels and marketing materials. They need to feel authentic. It’s not just about translating your ads—it’s about making sure your message resonates with your audience.

For instance, in Germany, straightforward advertising focused on product features tends to work best. Meanwhile, in Scandinavian countries, advertising focused on sustainability is more likely to speak to consumers. 

Have you already decided how you’ll reach your new customer base? Will you take international orders on your website, sell through local shops or partner with distributors in your target country? 

Direct sales channels tend to offer higher profit margins but also tend to cost more up front. You may need a multilingual e-commerce site, or you may want to open a warehouse closer to your international customers or points of sale.

Partnering with local businesses can lighten your workload and reduce your initial capital outlay. But since you won’t control every step of the sales process, it could be a good idea to protect your intellectual property, brand image and reputation.

When you’re expanding into other countries, there are always new legal and regulatory requirements to deal with. From labour standards to manufacturing, labelling, patents, data privacy, duties and sales tax, new rules are just part of the process. 

You may want to start by consulting Canada's free trade agreements. These agreements can make it easier to do business in certain countries, thanks to reduced tariffs and streamlined export rules. Trade agreements with countries such as the United States, Mexico and the European Union are common.

It’s also worth thinking about what kind of legal structure would work best in your target market. Should you set up a new legal entity in the region? Are there restrictions on foreign investment? What’s the corporate tax rate?

A wide range of tools is available that could support your global expansion at different stages of your project. Some resources are free, while others may entail certain costs, depending on what you need. Different types of funding and financial assistance can also help put larger investments within reach.

Before entering a new market, it’s important to get a solid understanding of its economic environment, consumer behaviour and key industry players. Luckily, there are plenty of tools out there that can help.

Some common types of tools that could be helpful include:

• Economic databases by country or industry

• Statistical platforms  

• Market forecasts and industry reports

Company directories with information on competitors, market segments or key decision-makers

EDC is a Crown corporation whose main role is to help Canadian businesses succeed in international markets. They regularly publish free, in-depth country reports and statistics. These reports highlight key economic indicators and business opportunities by industry, making them a great starting point for exploring new markets. 

For access to exclusive webinars and to connect with experts and peers, EDC offers a free tool: MyEDC.

When you’re expanding and embracing a new culture, you need more than just a solid translation. You also need a solid grasp of the local customs and expectations. Here are some tips for a smooth localization process. 

Free versions of generative AI tools can be handy for on-the-fly translations. As long as your request is clear, and provided you keep context and cultural differences in mind, these tools can do a decent job. But they’re far from perfect!

They can miss the mark on meaning or tone if their output isn’t checked by a person—and the negative impact of that could be significant for things like marketing materials and legal documents. Also, it’s best to avoid using AI for confidential materials. 

A lot of writers use pro versions of translation tools. These can produce fairly accurate translations, but it’s still important to have a native speaker or market expert give your texts a final once-over.

Some tools are developed with international businesses in mind and can take local context into account. This can help with automating certain tasks and can even be integrated with tools like CRMs, content creation platforms and websites. However, they can be expensive. Depending on how many users you have, how much content you’re working with, which languages you need and what tools you want to connect, you could be looking at anywhere from thousands to tens of thousands of dollars a year.

Desjardins International Gateway offers personalized support based on a proven methodology and knowledge used to identify market opportunities and the best strategies to help businesses grow beyond borders. It taps into Desjardins’s global network of partners in over 80 countries to conduct market studies, identify commercial partners (clients, distributors, etc.) and even provide support for mergers, acquisitions or the creation of a foreign subsidiary.

This tailor-made service is designed to support businesses of all sizes across all industries. 

There are many financial resources available to support your expansion plans, from grants to loans, international payment solutions and even equity investments. Here are a few ways you could fund your growth.

Through ISED, you have free access to the Business Benefits Finder. It can help you quickly find grants, loans, tax credits and other support programs that could be a good fit for your company.

Your financial institution can also offer support to help you develop new markets abroad. For example, you could talk to an advisor to find ways to manage currency risk and fluctuations in raw materials costs, improve cash management or open foreign currency accounts.

They might even be able to connect you with international trade professionals or potential business partners abroad.

What does support for international growth look like on the ground? Here are some real-world examples that illustrate how different approaches can be taken based on a company’s goals and markets, as well as the industry they operate in.

A major Canadian food company active in many countries set its sights on Mexico. It identified a growing interest there in unique Canadian flavours, with little in the way of competition.

Rather than trying to reinvent the wheel, they turned to Desjardins International Gateway.

With the help of a market study spearheaded by local professionals plugged into Mexico’s business culture, they were able to identify possible partners and prospects. 

The Mexican market offers huge growth potential and is a great stepping stone for them to efficiently develop their export strategy in a targeted way.

A luxury cosmetics brand based in Quebec wanted to tap into the UAE market—the largest in the Middle East. This was a logical next step for them, since the region is home to a wealthy clientele that appreciates the kind of premium, nature-inspired beauty products that the brand specializes in.

But it can be tough to be a new face in a new market. That’s where Desjardins International Gateway came in. With their support, the company was able to explore the most promising distribution channels: hotels, retail, luxury department stores and shopping malls. Potential partners were identified and the business owner travelled to the region to meet them as part of a successful trade mission. 

The signing of a contract could mark a key step in establishing a sustainable presence in the market and paving the way for the company to expand to other countries in the region.

A Quebec-based SME, recognized as a North American leader in wood product manufacturing, wanted to diversify its customer base to keep growing and stay ahead in a constantly changing economy.

With support from Desjardins International Gateway, the company zeroed in on the most promising distribution channels and carried out an in-depth market study. And their efforts paid off! They were able to identify three potential partners in Brazil who were interested in distributing their products.

To take things a step further, the company’s owner participated in a trade mission to Brazil to meet the potential partners face-to-face and strengthen those relationships.

Expanding internationally can be a game-changer, but it takes more than just ambition. A solid business plan, an international strategy, a deep understanding of the market conditions, the right tools and programs, and partners you can trust are often a must.

Whether you’re just starting to explore new growth opportunities or are ready to make your move, Desjardins is here to help. Learn more about our International Gateway service and take advantage of our global reach, local support and personalized guidance to help you grow internationally. 

> Find out more about Desjardins International Gateway