You're aching to start a business in college-and you're already thinking global. If you want a company with an international presence, listen to the experts: It's going to take serious research and planning. "No two nations or international market opportunities are the same," says Sherry Hoskinson, associate director of the Karl Eller Center/ McGuire Entrepreneurship Program at the University of Arizona in Tucson. She notes that students starting international businesses face the typical startup challenges as well as issues concerning taxes, trade law, currency conversion, language translation and cultural understanding (just to name a few).
Lin Miao and Blake Liguori are familiar with those challenges. Miao and Liguori, both 19-year-old sophomores at Babson College in Babson Park, Massachusetts, decided to go global when they officially launched 7DollarStuff.com, an online emporium of posters that sell for about $7, in July 2005. They then opened an eBay Store for added exposure. While marketing the low-cost décor to their fellow U.S. dormitory dwellers, they wanted to sell to young people in the United Kingdom as well. "[We thought], If this works so well in the U.S., why can't we do this internationally?" says Miao. In fact, eBay users often asked the pair if they would ship internationally to places like Canada, the UK and other European countries.
Securing a drop-ship supplier in the UK was the first challenge--Miao and Ligouri found one by contacting their U.S. supplier and asking for a referral. But stocking the right products to appeal to their UK customers was a bigger challenge. They quickly found that selling the exact same products wouldn't work for this different culture. "Most of our U.S. products were art-related, but we found that the UK customers are a pop [culture] community--they love music and movies more than the U.S. customers," says Miao. Based on some additional surveys and research, the pair tweaked their offering to be more pop-culture oriented for their 7DollarStuff.co.uk customers.
And though the pair kept their "7 Dollar" moniker the same for branding reasons, they found their magic price point overseas to be £3.99 (around $7 USD). The strategy seems to be working, as sales are robust just a few months into the venture--the pair projects revenue for their first full year to hit between $100,000 and $150,000.
Cultural understanding is key to any successful international venture. A big mistake is just assuming that a business idea will transfer over, says Manuel G. Serapio, associate professor of international business at the Bard Center for Entrepreneurship at the University of Colorado, Denver. "Do holistic-type research-identify the countries, opportunities, markets and business practices in those markets," he advises. "There are tons of resources--government sources both from the U.S. and in target countries, [as well as] companies and entrepreneurs that are already doing business there."
Hoskinson adds that aspiring international entrepreneurs should also glean information from their campus offerings, including international business professors, international students and international business programs. Also, check out the online listing of the Center for International Business Education and Research at http://ciberweb.msu.edu. CIBER has branches at 30 different universities across the U.S., including Columbia University, Duke University and the University of California, Los Angeles. The centers provide information and research about international business to both students and the business community at large.