Global expansion is a goal for most startups, as it provides access to larger markets and a more diverse customer base. In fact, 60% of startups aim to expand internationally within the first three years of operation; however, only 4.6% pass the scales successfully.

Achieving scaling status increases your chances of success in international markets, but this is a challenge in itself. Only 2.5% of startups formed in the activation stage ecosystem reach this milestone.

Your choice of market will determine whether your expansion becomes a success or a costly mistake. This is it especially true for startupswhere resources are often limited and early failures can have lasting consequences. But how can you make sure you're making the right decision? Here are seven important steps that can guide you in the process of choosing the most promising market for international expansion.

Related: How small businesses are coming together to boost local economies

1. Assess market readiness for the product

How well informed is the market? Consider factors such as internet penetration, the maturity of your industry and consumer buying habits that will help you gain comprehensive insight into the local landscape. For example, if your business is e-commerce, look for markets where people have already started ordering online.

An alternative strategy involves entering less developed markets that are not as familiar with your field and, therefore, less competitive. However, in this case, it's a long-term game, as you have to invest time in cultivating new habits among customers and targeting early adopters. Your business can also alternate strategies based on location: we currently operate in both mature and emerging markets, each with varying levels of e-commerce and e-gifting adoption.

2. Analyze the competitive landscape

If three or more competitors share the market, it is a highly competitive environment that will require significant investment to achieve significant results. However, if there is a dominant competitor whose ways are relatively rigid, you can try to secure the second position in the market by using agility, modernity and a different approach to customer engagement.

At this stage, it is important to assess the overall size of the market and its distribution among competitors in monetary terms. Key metrics include:

Total addressable market (TAM): This shows the total income potential available in the market. In our case, it reflects the total sales of flowers throughout the country.

Addressable serviceable market (SAM): For Flowwow, this reflects the actual online sales figures and revenue generated by our competitors.

Available accessible market (SEAM): This metric estimates the share you can actually capture, representing the share of market revenue you can control.

3. Use scoring patterns

After you have assessed the readiness of the product in the market and analyzed the competitionyou will have identified several priority countries that can be considered potential markets for scaling. Scoring patterns can be very helpful in choosing the best one or two options.

For example, Amazon used a scoring model to evaluate key success factors when expanding into Asian markets. The focus was on India and Japan, where the company made significant investments in infrastructure, local partnerships and adaptation of payment systems. In both countries, Amazon became one of the market leaders, overcoming a complex and diverse environment.

4. Conducting field research

Field research is one of the key steps in the business scaling process, helping to understand the real situation in the target market. This method uncovers actual customer pain points that may not be apparent from aggregate data. Customer development interviews provide a deeper understanding of cultural nuances, local customs, and the specifics of interacting with the product or service. If in-person meetings are not possible, conduct online interviews with customers (you can find them on LinkedIn or in interest-based communities).

For example, our startup is a gift marketplace that relies heavily on online payment methods. Through market research, we found that online payments are preferred by customers, but method preferences can vary significantly. When entering a new market, we must integrate local payment systems, a process that requires legal and technical work and thorough research. If the preparations are not complete, the market will simply not be able to accept new orders.

Related: Why research is key to startup growth and customer centricity

5. Test the loading speed of your site and application

In the era of high-speed Internet, user experience is critical to e-commerce success. Slow loading pages frustrate users, leading to high bounce rates, reduced conversions and a negative impact on brand perception.

According to Amazon, a delay of 100 milliseconds in page load time can lead to a 1% loss in saleswhile another survey suggests that 53% of site visitors will leave the page if it takes more than three seconds to load. Conversely, satisfied customers can spend up to 140% more and will recommend companies to others when they feel valued.

6. Find a product-market fit

Start by developing a minimum viable product (MVP) that directly addresses the core issues of your target audience. Launch this MVP and collect detailed feedback from users, analyzing their behavior and preferences. The key is to refine your product based on these insights, modifying its features to better match market demands. Regularly track performance indicators such as user satisfaction and engagement to confirm whether your product solves the market's problem. Iterate and improve continuously until you achieve a steady flow of sales from the local audience, signaling that you have achieved PMF.

A well-known example is Airbnbwhich began during a conference in San Francisco when its founders rented out their property to address the housing shortage. By gathering user feedback, they refined their offering, emphasizing the value of unique stays and ease of booking. This iterative process, combined with a focus on user needs, helped Airbnb grow into the global leader in short-term rentals today.

Related: Product-Market Fit: How to Measure If Your Business is Filling a Need

7. Hire a country manager

Once you've achieved product-market fit—that is, you've earned a steady stream of sales from your local audience—consider hiring a country manager. They provide in-depth knowledge of the local market, adapt the company's strategy to the country's cultural and regulatory specifics, and create important business connections, facilitating business development in the new market.

Choosing the right market for international expansion is a critical decision that can determine the success or failure of a startup's global journey. Following these seven steps can significantly improve your chances of making strategic decisions. Careful market selection and adaptation to local needs and conditions will lay a solid foundation for sustainable international growth.