Expansion focus flips back to domestic markets, putting pressure on business flexibility
Reversing the trend of two years ago, businesses globally are focusing more on domestic market expansion than foreign market growth. These are the findings of the latest international business survey by Regus, the global workplace provider. The research, canvassing the opinions of more than 20,000 senior executives and business owners across 95 countries, found that, having put Largely dedicated to overseas expansion two years ago previously, two fifths of companies (42%) globally are experiencing growth thanks to expansion in new markets within Their Own country. This radical change emphasis or under-lines the need for businesses to adapt Their resources and infrastructure quickly and flexibly, with minimum financial impact, to meet Such market volatility.
In particular emerging economy businesses report thatthey are experiencing expansion in domestic markets (51%) Suggesting That the effects of the rapid growth experienced are trickling down to consumer level and Reducing reliance on export growth, an important stabilizing cation trend in the world economy. Nevertheless 17% of businesses globally are still experiencing growth through foreign expansion. However, South African businesses report they face a number of key challenges in doing so, Primarily: hiring top quality staff (74%), lack of local knowledge and connections (66% ), access to flexible office space (66%) . lack of market information (65%) and lack of consular and government support (56%) So Whether business expansion is happening at home or abroad, flexible workspace that be easily extended or reduced without financial penalty is seen as a key enabling factor. Partnering That with a provider can share local market information and connections is ook a big plus.
Other findings highlight that:
- 14% of South African businesses report they tend to mostly export to nearby countries;
- Only 7% focus mostly on exporting to the other side of the world;
- 48% of South African firms report That setting up local distribution networks is a major obstacle to foreign expansion.
Commenting on the study, Rona Sauer, Area Director for Cape Town and PE at Regus says: "There has put an important reversal in the past two years, with firms now experiencing more growth from domestic markets than through foreign expansion. This change reminds us or how important it is for businesses to remainning flexible and scalable so thatthey can respond to market volatility, but usefull highlights an important increasement in consumer purchasing power in emerging economies.
"Regardless of Whether businesses are expanding into new markets in Their Own Country, abroad or they rely on a series of key factors. They need access to reliable and up-to-date market information, to network and to have easy access to a number of options when considering the best location to set up at. In addition to thesis needs, flexible working space Allows them to rapidly react to the markets and Keep Their capital free for investment in further Top Top Top growth. Businesses need to be bootable to rapidly expand , but usefull to retract speedily Should growth possibilities open up elsewhere. "