Author: Artur Lupashko, CEO of Ribas Hotels Group

The article was published on delo.ua

Sooner or later, every business owner whose business model allows for it thinks about scaling services beyond their own country. However, not everyone dares to do so, given the number of challenges that await them. New markets are always a step out of one's comfort zone, but new experiences are often worth it.

Why companies need to enter international markets:

What challenges will you face?

Before going abroad, a company needs to analyse possible challenges. This will help to avoid major mistakes and develop a strategy. Let's take a look at the main problems a business may face.

Pain No. 1 is ignorance of the market. People working abroad generally believe that it makes no sense to analyse a new market, because the business reality can be completely different. In our case, our clients are hotel owners and developers, and analytics won't really show what is really important to them.

Solution: communicate directly with customers and actively engage them in cooperation. Working with clients in this format, you can better understand their needs and find out why they choose a Ukrainian company.

Given our limited resources, we had to choose the best way to develop in foreign markets. For example, we could not afford to send separate teams abroad, so we made the most of our contacts and friends in different markets to help us expand. By actively experimenting and communicating with people in countries such as Austria, the Czech Republic, Montenegro, Georgia, and Indonesia, we sought to gain as much knowledge and experience as possible. Although it was challenging, this individual approach allowed us to take the first step in conquering the international market and gain such valuable experience in interacting with different cultures and consumers.

For each project in Ukraine and abroad, we always do a detailed market analysis and study competitors. This was the case in Italy, Armenia, Kazakhstan and Indonesia. In addition, we additionally buy insider information from local hotels about their performance, trends, and changes in value.

On the visualisation: Bautzen by Ribas hotel (Jelenia Góra, Poland)

Pain No. 2 is finding and adapting a new team. No matter how systematic your business is, the lack of face-to-face meetings and joint work with new staff can make it difficult to assimilate the company's values and the principles that guide the team at the head office.

The solution: relocate your employees. For example, one of our colleagues is already successfully working on projects in Bali, and by the end of the year, we plan to relocate another project manager to Poland. This step allows us to transfer a part of our corporate culture through our Ukrainian colleagues and to formulate tasks for local employees more clearly.

It is worth noting that for most vacancies abroad, it is preferable to hire local employees. This is especially true for positions where active communication is important, such as in the sales department or the analytical marketing department. This approach is driven by the need to understand the specifics of the local market. In addition, the professionals involved in negotiations should definitely be local.

When selecting employees, we pay special attention to motivation. Our company usually works with people who live the industry and are interested in developing in it.

The search for a new team is the responsibility of the top manager in charge of the business area. Next, we work on the adaptation of hotel and office employees using an e-learning system. It provides them with all the information they need for their work: analytics and responsibilities. It's worth noting that each new employee is assigned a manager who accompanies them through the adaptation process.

On the visualisation: a hotel in Canacea (Italy)

Pain No. 3 is the mismatch of business processes with foreign markets. This can be a significant challenge due to the difference in cultural, legal and economic environments. What works well in Ukraine may not always be effective in a new territory.

Solution: There are two main strategies to avoid adaptation problems. The first is to acquire a smaller company that already operates in the desired market and has experience and a team. This allows you to quickly get a ready-made system and expertise. Of course, for companies that are just starting to expand into foreign markets, this approach can be a challenge, given the limited budget.

The second option is to use the services of experts who already have experience in international markets and can transfer their knowledge and practices to your team. This approach allows you to attract valuable specialists, but there is a risk of possible transfer of mistakes. However, business is about risk, and every decision is a bet on certain people or markets. What approaches are most effective and useful for the company can only be determined over time.

In our experience, we believe that all business processes are similar and can only differ in structure. Let's take a hotel in Italy that we will manage as an example. It is currently under development. In this market, the methods of cooperation with employees, taxation, supply of products, and construction approval are mostly different.

We understand what points to pay special attention to during the research and study them. So, before calculating the hotel's financial model, we will thoroughly understand all financial issues, consult with local experts, and compare our results with those predicted by the forecasters.

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