Currently based in London helping launch web company SilverStripe into Europe, Tim Copeland gives readers a taste of the reality of ‘going international’.

International markets represent an exciting growth opportunity for many New Zealand companies, and if done correctly, it can significantly increase the value of your company, but at the same time, the time and energy required can be a huge drain and distraction on any company. Fortunately these days, ‘going international’ is easier than it was even ten years ago, much of it thanks to the internet, and there are a number of simple and cheap things you can do to open your business up to the rest of the world.

Getting started

For most of us our first taste of ‘international work’ comes from enquiries via our websites (as does much of our local business) so of all the things you need to get right first, it’s your website. Two simple things you can do which make a big difference are to post photos of your staff along with a short bio (it helps outsiders know you’re real and your size), and get a blog going and update it several times a month (many prospective customers will look at your site for months before making contact, and it’s a good way of letting them know your alive and kicking still!). If you want to get tricky, you can get your website to automatically detect the location of your visitor, and serve up localised content to them. For example if you’re targeting US visitors, you can make your home page display case studies of other US clients of yours, your US phone number (which redirects to your mobile and wakes you and your partner in middle of the night – just remember keep a emergency supply of flowers ready to placate your partner the day after…), and a picture of the American flag for subtlety. In this content the first impression a US visitor will have is that you know the American market, which in their mind makes you a lot less risky to deal with. Once you’ve starting getting a steady stream of enquiries, you can be reasonably confident that there is demand for what you’ve got to offer,  the question then becomes, how do you grow and satisfy that demand without spending a fortune?

Choosing markets

In my experience, companies based in English speaking markets where our working days cross over, are the most likely to enquire directly from your website. This basically means the east coast of the US and Australian markets are where you’ll likely get most enquiries from. What this also means is you shouldn’t expect too many leads to come from European companies, even if you have a lot of visitors to your website from there.

Pricing

If we are to look at hourly rates, we’re probably the cheapest of the “first world” countries, which gives us significant cost advantages when competing in other “first world” markets. As a general rule of thumb, we’re about half the price of local North American and Western European companies, giving us the opportunity to both increase our rates, and undercut the local competition.

We are, however, perceived as being expensive when compared to many developing nations who are also competing for out-sourced work. However, hourly rates alone are a poor indication of cost effectiveness and more people are becoming aware of this.  A UK company I talked with recently who tried outsourcing some of their development work to China last year told of their experience “in the end they [the vendor] were about 15 per cent cheaper [than a local firm], however, given the amount of pain we experienced with the project, it just wasn’t worth it”. Most of the ‘pain’ they experienced was due to mismatched expectations. This wasn’t due to neglect or incompetence on the part of the vendor, but a more fundamental cultural difference in thinking. This is where brand New Zealand kicks in. Our way of thinking, and our upbringing is more similar to that of people in North American and Western European markets than our competitors in developing worlds, we’re better able to anticipate and understand what drives companies, and consequently are better placed to deliver solutions which actually work. Anecdotally we’re also a lot more pleasant to deal with as well. Of course, these sort price advantages only come in when you’re doing much of the project work back in New Zealand – if a team is required on the ground with your client, we lose many of these.

The one other key thing to remember when pricing work is that exchange rates are not fixed, and there is going to be a difference in what you expect to receive when you issue a quote, and what you receive when your bills are paid. You are not totally at the mercy of exchange rates, many banks offer products which offer you some form of protection from these fluctuations.

Communicating

Probably the biggest new hurdle you are going to have is around communication. Time zone differences mean there are only certain hours of the day which you can talk, and we’ve found that scheduling regular, re-occurring calls is a good way to keep everyone on the same page . Skype (a free internet based phone tool), is an indispensable tool for communication.  You can easily setup phone conferences with multiple people at multiple locations or better still use it for high definition video conferencing, enabling you to pickup on all the subtleties of expression which are lost in voice only calls.
A top of the line web cam and headset will set you back about $300 in total, which is about the cost of an hour at a conventional video conferencing studio, or about an hour in a plane to a meeting. It’s an investment you won’t regret.
One thing which no technology can help with however is our accents – many people in the US seem to have difficulty understanding us (though we can understand them perfectly thanks to a lifetime of American content on TV), the trick is to talk really slowly (we actually speak English quite fast as it is)… and send them a DVD of the Flight of the Concords to help them acclimatize.

Getting connected

If you’ve decided you’re ready to take on the world, you’ll be pleased to know you are not alone. The network to join when your ready to make your mark on the world is Made From New Zealand (www.madefromnewzealand.com). Sign up, and join other companies making their mark on the world.

Tim Copeland is one of the co-founders and the former CEO of SilverStripe (a Wellington based web development company) and former Chairman of Unlimited Potential (Wellington’s largest IT network).tim@silverstripe.com