Global growth is forecast to be in the 3.5% range in 2012, down from 4.0% in 2011 primarily due to the deepening economic and fiscal crises being encountered in the European Community, especially in Greece, Portugal, Spain and Ireland. These negative impacts will be offset by slow but recovering growth in the US and other major advanced economies. Further, strong demand in emerging and developing countries will help position global growth for an increase to 4% in 2013. The ongoing key challenge to the world economy will be the impaired growth prospects in the G7 countries and the advanced economies as a group, which will average annual composite growth of 1.5% – 2.0% over the next two years.
As the “rich” countries experience slow growth, an unlikely group will take on the economic leadership role in the near-to-medium term. Real GDP growth in the emerging and developing economies will range from 5.75% in 2012, growing to 6.5% in 2013. Smart forward-thinking companies will seek out new customers wherever in the world they are located. The world is shrinking more and more every day, enabled by instantaneous communications and a desire to have western world goods in developing and emerging economies. This means that small and medium-sized businesses (under $250 million) in the US, Canada and Western Europe will need to expand their market view and business reach to ensure that they are well-positioned in the years ahead.
Western firms in these areas that do not yet understand the need to balance their customer portfolios through international expansion will likely see their domestic market share erode as new competitors from across the globe enter the US market. New market entrants are being seen from Latin America, Eastern Europe and Southeast Asia. Companies from these regions are learning quickly and adapting to the new world economic order. They will compete with newer and better products that are competitively priced.
The days of focusing only on one’s domestic market or minimal expansion through a small number of international markets located in close proximity to home will not be an effective business growth strategy for the decade ahead. If you company does not have a 1 – 3 year plan for global expansion, you risk falling behind with every passing day. Let us help you take action now, so that we can help you plan for a future of continuous revenue and profit growth.