When businesses are looking to expand internationally, the UK is often at the top of their list. Globally, the UK consistently ranks among the top 10 countries for ease of doing business. At Bridgehead, we’ve helped many scaleups to successfully enter the UK market, working with them to develop go-to-market strategies and specialist teams to execute them. If you’re considering the UK market, we’ve compiled a list of things to consider.
According to GlobalData [1], the biggest sectors in the UK market are:
- Food & Grocery
- Clothing & footwear
- Health and beauty
- Electricals
- Homewares
- Furniture & floor coverings
- DIY & Garden
The key distribution channels in the UK are highly competitive, and there’s the potential to come up against established brands, so it’s essential to have a research-informed strategy and location-based approach.
We compiled the key considerations startups and scaleups should consider when eyeing UK expansion.
Our top tips to successfully enter the UK market
Be aware of British business culture
We always stress the importance of factoring in local cultural nuances and business practices when entering a new market rather than making assumptions. For more advice, check out our blog on unexpected cultural differences in business etiquette.
Business owners from outside the UK may at first be wary of the famed British ‘stiff upper lip’. But in reality, business in the UK has become less formal. Deals are usually done on first-name terms, and Brits are, as a rule, fans of small talk and humour. If you’re meeting someone from the UK for business, punctuality is a priority and providing refreshments is appreciated. One thing to avoid, however, is intruding on personal space. Handshaking is still the most common greeting, though it’s not always expected in the aftermath of Covid.
Breed loyalty by meeting UK consumer expectations
Our research shows the UK market is diverse. Consumers with potent purchasing power value quality, innovation and premium products. On average, consumers in the UK spend £528.80 per week on goods and services. The Consumer Rights Act [2] sets out how UK consumers buy and are sold to. It’s essential to be aware of and adhere to this legislation.
UK consumers tend to be loyal to brands that align with their values and meet customer service expectations by being responsive and empathetic. Good customer service and after-sales service are valued. When things go right or wrong, giving feedback is commonplace. In an online Capterra [3] survey, 44% of consumers said they usually provide feedback regardless of whether an experience is positive or negative.
With this in mind, analysing reviews for competitors can be valuable for identifying where to position yourself in the UK market. Once launched, monitoring customer feedback is vital for ensuring you meet consumer expectations.
Brush up on UK regulations
If you make it your business to trade in Britain, you must adhere to regulations and legislation. As a starting point, you’ll need to establish whether you plan to work with partners or establish a presence in the UK. If the latter, you’ll usually need to register with Companies House.
From a product point of view, safety, testing and labelling regulations in the UK are stringent. As a result, labelling and packaging compliance need to be at the forefront of your packaging design. The UK is also known for its robust intellectual property and data protection laws, and you’ll need to be prepared to meet these to enter and remain in the market.
Size up your staffing options
If you plan to establish a UK presence, you can expect to pay £33,402 as the average UK salary. You must follow UK employment law to get those employees in place. Also essential is adhering to equality and discrimination legislation during advertising and hiring. Plus, factoring in employee legal rights. UK employee rights [4] cover hours of work, sick pay, family leave, notice and dismissal. You must also provide each employee with a written contract outlining their terms of employment. Contracts must include details such as salary, work hours, sickness absence, notice period, disciplinary procedures and holiday pay.
Grab attention through marketing
The British market is competitive. Whatever your niche, you must plan how you’ll make your mark. Research suggests you should set aside between 10-15% of your forecasted revenue for marketing expenditure. When moving into new markets, you should never assume you’ll target the same customer profile as in other countries or use the same methods. Research is vital; UK partners can help you to understand your potential UK customer profile, how to reach them, potential pitfalls and ultimately, how to build trust that converts into sales. International mocking [5] of Volkswagen’s Italian Instagram handle in 2022 serves as a reminder of how global brands should always consider marketing from an international perspective.
Deploying local consultants to reach channel partners
Navigating the UK market can, at times, be complex and challenging. Leveraging local expertise who understands the market with established relationships with channel partners will simplify and speed up the entry process.
At Bridgehead, we are a go-to-market agency who create and implement go-to-market strategies to help your business penetrate the UK market. For companies selling products, we also provide distribution services. Want to enter the UK for your business? Talk to us today.
References:
[1] https://www.globaldata.com/store/report/uk-retail-market-analysis/
[2]: https://www.legislation.gov.uk/ukpga/2015/15/contents/enacted
[3]: https://www.capterra.co.uk/blog/3299/consumer-expectations-of-customer-service-uk-and-worldwide
[4]: https://www.gov.uk/employment-status/employee
[5]: https://nypost.com/2022/11/29/volkswagen-italy-mocked-over-unfortunate-instagram-handle/
