In times like these, it’s easy for retailers to draw in their horns and retreat to their core markets. But, as Brett Lawrence outlined earlier in the year, it’s important to preserve investment and a global outlook, even while the world looks uncertain.
We have a mantra of “go visit” to maintain our global perspective. Of course, we invest in new technologies like video conferencing, but have yet to find the perfect solution. So, we also do old-fashioned things like, getting on a plane to visit distance offices, offering an exchange programme for our staff, and taking some time to understand the local culture and challenges.
This works for any distance office/branch/location, but Brexit is encouraging ecommerce companies to look at markets which are further afield. Of course, the USA appears to offer a large, culturally similar market, where ecommerce companies can replicate their local success.
Don’t be fooled, as an English-speaking country, into believing growth in the States can be managed from your desk in the UK. As a veteran of the transatlantic business relationship, I’ve seen first-hand some of the challenges that expanding into the USA can throw up. If you want to expand into the USA, it’s not enough just to ship there, you have to get on a plane and have a physical presence in the country too.
My experience of UK/USA growth spans internet companies like AskJeeves, iVillage and SkinStore. I now head up Spreadshirt, an on-person, self-expression ecommerce company, with an HQ in Leipzig, Germany and US centres in Greensburg (Pennsylvania), Henderson (Nevada) and Boston. After fifteen years in business, we’re now the European market-leader in self-expression on clothing and a major player in North America.
So we’ve seen some of the pitfalls that companies face when expanding to the US and think they can be overcome by maintaining your global outlook: visit, listen and engage.
Time and distance kills relationships. It can’t all be done via emails, system tickets (which manage tasks and workflows) and a few late-night calls between geographically distant locations. If you’re going to make it work you need to get on a plane regularly.
It sounds obvious but our US west coast factory near Las Vegas is just starting work when the German HQ has just gone home. Even the best, most dedicated management will find themselves feeling alienated by distance. Distrust and demotivation soon set in and small problems can build up into the idea that HQ does not care about the local business.
Never underestimate the effect of turning up in person. It makes your production and sales offices feel loved when the senior team arrive. You get the chance for some informal conversations and to see for yourself how the local dynamics work.
It’s also not just about the CEO flying in to admire the work being done. We make sure all our business functions do the same and our new exchange programme extends this opportunity across the business. This idea is to help raise awareness of each other, and our cultural and business backgrounds. All employees can apply to become Spreadshirt Ambassadors on a week-long trip to other facilities to engage and exchange with our colleagues there. It’s an opportunity to think outside of the box, and to experience the varied work and life cultures across Spreadshirt.
Don’t think that because the language is the same the issues will be the same too. It’s not the same place and you need to understand the local challenges. There are huge differences in the language of marketing and selling between the UK and the USA. Americans are far more effusive and always offer a big discount. The UK tends to downplay things and is more modest in the language it uses for marketing.
The best way to understand what’s going on and to spot the differences, is to listen to the insight the local team have; again, by showing up in person. I often get objections that it will not be worth it for certain functions, or there is not enough to do when the person gets there. But I can instantly tell the level of trust is higher for the departments that have visited and it improves future co-operation, which saves money and increases motivation.
Engage and share
Don’t assume the new team will automatically understand the company’s global mindset and be prepared to share your knowledge from HQ.
The local team in the USA will work extremely hard, be enthusiastic and goal-oriented. It will help if you can take the time to engage them in the company’s global priorities. Teams at a distance from HQ have their own problems and local issues. The central team will often be needed to help fix them. Obviously the central team has its own, global, priorities, which they may feel are more important. This is why it’s useful for different business functions to go visit. Everyone gets to see and share the local and HQ issues.
It’s comforting, even necessary, in uncertain times to concentrate on your central market. But maintaining a global outlook during the Brexit process could mean you come out the other side in a better position than you went in. For the USA market, we found expansion was easier when we focussed on sharing our priorities with our local teams, listening to their market insight and getting on plane. Go visit!
Philip Rooke is CEO of Spreadshirt