Despite the fact that it has never been easier, a company\u2019s international expansion still retains an exotic allure today.\r\n\r\nWells Fargo\u2019s 2015 International Business Indicator recently found that 60% of US companies expect to increase international business development planning in 2015. It remains a goal, and then a milestone, for fast-growing successful businesses to expand beyond their native market and move into international territory.\r\nWhether it\u2019s San Francisco or Spain, launching in another location is one of the most challenging benchmarks an entrepreneur can experience. In the past year, we grew our company globally and we now have offices in London, New York, Barcelona, Dubai and Santiago de Chile. Companies with truly global ambitions have probably seen a good degree of success at home, but I\u2019ve observed a tendency among these organisations to lose control of their senses when moving overseas. Too often, companies seem to simply stick a pin in the map in order to locate their first international move, or target the market du jour.\r\nThis strategy invariably leads to disaster. You wouldn\u2019t launch a business without careful research and planning on things like barriers to entry, market fit and size, distribution networks, local partnerships, language barriers and scalability potential. So why take the risk of abandoning these principles when going global? International expansion can be widely profitable for your business, as long as you consider three key variables.\r\n\r\nMake Sure There\u2019s A Need In The Market\r\nFor instance, a UK-based company may have dreams of launching in the US, but this is rarely a realistic ambition. The two countries may share a common language, but this counts for nothing if you are moving into an already-saturated market vertical to compete with established players.\r\nOne example of a failed expansion into a new territory is Target\u2019s move into Canada. Problems ranging from real estate challenges to botched technology rollouts to poor training contributed to this high-profile failure, with some analysts pointing out that many Canadians already cross the border into the US to visit Target stores anyway. There simply wasn\u2019t a compelling business case for Target to expand into Canada.\r\nOur expansion abroad was generated simply by the global nature of our business. We build partnerships with local leading financial institutions and service providers that can allow their best clients to join our network and connect to trustworthy business leaders worldwide. We are present in the main financial centers in four continents and we\u2019re about to expand in Asia.\r\n\r\nUnderstand Local Regulations And Cultural Preferences\r\nSome years earlier, Target rival WalMart attempted a similarly ill-judged move into the German market, which ended up costing it an estimated $1 Bn. Ultimately, this was down to a lack of understanding of German labour laws and restrictions on business hours, which meant that Walmart couldn\u2019t operate profitably in the country. In this case, a lack of local knowledge coupled with a misjudgment of the market opportunity proved extremely costly.\r\n\r\n\r\nResearch is vital for businesses that may not have the resources to recover financially from a failed international market entry. To properly plan expansion into unfamiliar territories, tap contacts that are familiar with the country, leverage their knowledge, and arm yourself with as much information about potential partners and prospects as possible.\r\n\r\nWe decided to position our product team in Barcelona because of the presence of initiatives that sustain startups and the presence of diverse talent.\r\n\r\nBuild A Local Network\r\nEntering a new market may require a company to make a number of acquisitions so they have appropriate premises to operate from, or perhaps they will be looking for partners, distributors and the like. But knowing who to trust is key.\r\nBegin by tapping into your network\u2019s trusted contacts and finding the common connections. Credible businesses often have strong relationships with reputable business schools, top financial institutions, and industry-leading companies. Otherwise, you\u2019ll want to grow your business the same way you may have started your company: attending events, scouting out similar companies in your industry, and investing in sales and marketing.\r\nLuckily, technology makes this step easier. While the way business deals have been done has changed very little for many years, we now have the luxury of using online and mobile tools to our advantage. Social networks mean that we can find out a lot about people and initiate a relationship before meeting them in person. It is even possible to do this with potential business deals and services (not just individuals) now.\r\nWhen doing business overseas, it can be hard to really understand local markets, and tricky to navigate entrenched territorial networks. The two qualities executives need when expanding internationally are a mind open to possibilities, and a healthy dose of realism. Understanding the barriers to entry in each market \u2013 whether they are cultural, regulatory, or simply a lack of a personal network \u2013 will save money otherwise spent on a more fragmented globalisation approach. A focussed, researched strategy may help you discover a profitable market you didn\u2019t previously consider.\r\n\r\n\r\n\r\nAbout The Author\r\n[Brian Pallas is the Chairman, CEO, and Founder of Opportunity Network. He holds an MBA from Columbia Business School.]\r\n\r\n\r\n\r\nThe Young Entrepreneur Council (YEC) is an invite-only organisation comprising the world\u2019s most promising young entrepreneurs. In partnership with Citi, YEC recently launched BusinessCollective, a free virtual mentorship programme that helps millions of entrepreneurs start and grow businesses.