If you're like every other entrepreneur I know, you're constantly on the lookout for a way to grow your business. Whether I'm finding a novel way to monetize my expertise or simply reach out to new prospects, I spend lots of energy on cultivating new revenue streams. The global marketplace is a pool of potential that's just waiting for new buyers and sellers. And if you have a sound growth strategy, there could be a fair amount of money to be made there.
Doing business internationally can be complicated, and it's vital that you manage expenses wisely. What follows are my tried-and-tested strategies for ensuring you're getting the most out of your international transactions.
1. Go where the dollar is strong.
Currency valuation can be a bit of a black hole: It can consuming all your time and energy if you're looking to make money on every wobble. But I'm talking more big-picture here.
Take a look at where the dollar buys you more (compared to say, one year ago) and look to purchase goods or travel to those locations.
Countries like Argentina, Mexico, India and South Africa have national currencies that are presently struggling when compared to the dollar. Leveraging the strength of the dollar can be a profitable growth strategy.
2. Make sure you know how international payments work.
There are many different ways to move money from one place to another and from one currency to another. But here's the not-so-pleasant secret: The cost of those transactions can vary wildly, even if you keep track of the exchange rate.
A friend of mine just recently sent an invoice to a client in Canada. He was mortified (and a little irate) when he told me about the transaction.
You may not realize that shipping costs may be negotiable. If you're willing to get quotes from multiple shippers, you might be able to talk one of them down a bit.
The client asked if she could pay in Canadian dollars, and he said that was fine. He did a quick calculation based on the exchange rate that day—one Canadian dollar was fetching $0.75 USD—and he told her what to send via electronic payment.
What he didn't reckon was the lousy exchange rate he'd get, coupled with a hefty transaction charge. He ended up getting just over half what he'd expected.
The moral of the story is that you should make sure you understand the bottom line when you're dealing with multiple currencies.
3. Find a reliable platform for international payments.
If you're going to do any significant number of international transactions, it's to your benefit to make finding a reliable, reasonable platform for handling them part of your growth strategy. Look for platforms that allow you to send and receive money in multiple currencies, and there's no minimum or maximum limit for transactions.
Additionally, be sure that the platform you choose offers competitive rates, and can house all your foreign transactions on a single site makes it easier to track and manage your funds. When you evaluate your growth strategy, you may realize you don't have time to deal with international transactions on an ad-hoc basis.
4. Embrace the freelancer economy.
We all know the cost of living varies wildly from one country to another—but did you know that this could present a valuable opportunity? If you have staffing needs that a freelancer can fulfill, you may be able to reduce your payroll by finding affordable international freelancers to complete your tasks.
That said, you do need to be careful, because language barriers can make negotiations difficult, and there are certainly tasks that are better suited for a traditionally employed worker. But for tasks like data entry or graphic design, you might be able to find outstanding freelancers who are part of your growth strategy and can supplement the work done by your U.S.-based employees.
5. Manage shipping costs.
If you're looking to boost your profitability by using lower-cost international vendors, you can't afford to ignore shipping costs.
In general, the more patient you can be, the lower your shipping rates will be. But that's not the end of the story. You may not realize that shipping costs may be negotiable. If you're willing to get quotes from multiple shippers, you might be able to talk one of them down a bit.
Also, don't ignore the effect packaging can have on freight costs. You may be able to dramatically reduce shipping fees by packing items in bags, rather than boxes or by reducing the weight or size of individual packaging.
The global marketplace is ripe for hungry entrepreneurs looking for expansion, and new revenue streams and clients. By being deliberate and doing a little research, you can use these growth strategies to capitalize on your opportunities while avoiding expensive pitfalls.
Read more articles on growth opportunities.
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