Expanding into New Locations
Alternative New Market Entry Approach
Apart from gradually entering new locations one at a time, it's also possible to take a salvo approach and begin with sets of countries. For example, you may start with three different regions and then pick the top performer. At the next
quarter, or other structured time period that you select, another set of three areas will be tested. Thus, at each trial you choose a number of countries to test and only keep the ones that perform best.
That process enables you to continuously build on this rollout model until the desired outcome is reached. Let’s contemplate a scenario where your end goal is expansion to 18 different countries and your team has determined the most likely
high-payoff candidates. The ideal strategy would probably be to focus on a small higher payoff group first and then validate which areas within those groups are going to be the highest actual payoff, based on real data. Once the top
performing locations are uncovered, you may continue to evaluate potential for further investment in those areas. Based on the completed transaction count, maybe it will make sense to establish a regional distribution center or develop some
kind of concept around an actual dedicated warehouse.
You can commonly work with partners to set up a distribution center in your targeted location. The partners might simply house many different sets of products for a number of distinct sellers. You would just rent space within that
distribution network and effectively get logistics in place to physically move your items in a relatively just-in-time nature, from your actual manufacturing facility, or facilities, into those distribution warehouses.
This is something that typically requires or benefits from an integration into back office software, to properly manage the inventory and order fulfillment or transfers into those distribution centers. We absolutely encourage you to evaluate
this capability within your international eCommerce platform of choice.