Why global ambition doesn’t always equal global success – and the enabler every ambitious manufacturer needs 

Global manufacturing leaders share a common ambition: expand into new markets, scale operations, and capture growth where demand is rising. But too often, these ambitions collide with a hidden cost — the underestimated complexity of local markets. Regulations, supply chain realities, and cultural expectations can undo even the best-laid expansion strategies, turning growth plans into costly setbacks.

In Chapter 1 of this series (“Smart factories, smarter risks”), we explored how technology is transforming the sector. Here, we look at the other half of the equation: market fluency. For manufacturers, making sure their content matches their audience isn’t a finishing touch — it’s the infrastructure that ensures global ambition translates into sustainable success.

Global ambition meets local reality

Global manufacturing is increasingly recovering from recent economic and geopolitical shocks. Growth has returned to the sector, with many analysts predicting output growth of up to 5% over the next five years. But as always, this global pattern masks distinct regional trends: Europe is forecast for only moderate growth, and an increasingly developed China is expected to grow more slowly than we’ve seen in the past. On the other hand, emerging economies, particularly within Asia, are expected to perform much more strongly.

There are many reasons why established manufacturers may want to expand their operations into regions experiencing economic prosperity. Often, strong growth is fuelled by favourable conditions on the ground, such as tax breaks, low labor or land costs, or a good supply of skills. Equally, creating new plants in new territories makes it easier to satisfy regional demand, offering different products, built in factories that benefit from efficiencies in local supply chains and distribution.

But expanding into new territories is riddled with pitfalls. The same labor, land or regulatory differences that create strategic advantage, also present businesses with complexity. Core processes, training, instructions and policies will need not just translation, but careful adaptation for the regulatory and cultural environment in which the business now works. Brands are easily mismanaged, with core messaging that resonates at home potentially missing the mark in a new culture. And supply chains have to be adapted or rebuilt, presenting hurdles in communication, expectation and regulation that need to be identified and addressed.

Why expansion fails: three drivers of underperformance

This labyrinth of differences to the home territory is often concealed. While headline differences – such as India’s Digital Personal Data Protection Act (DPDP) – are easily spotted, these often represent the tip of a much more subtle iceberg. Indian workers, suppliers and society in general have different languages, experiences and cultural expectations than your own.

Why does this matter? With operational and product maturity, manufacturers often fall into the trap of assuming that their smooth workflows and production processes are the correct answer to a universal question. But what works brilliantly in, for example, the well-regulated environment of the European Union, can prove slow and unwieldy in developing nations, or might not reflect supply chain realities in South America.

Companies often expand without adjusting how they hire, sell, comply, or support customers locally. Assumptions about staffing, procurement, payments, compliance, and service levels fall apart in practice. Fixing those gaps takes time and budget, and early-stage businesses are least able to withstand the impact. 

This isn’t a new phenomenon either. Nine years after entering the German retail market, Walmart called time on the territory. In retrospect, the US giant made several strategic mistakes, including failing to anticipate German consumer preferences for fresh foods, and assuming that consumers in a nation with strong public transport would want to drive to stores. Famously, the brand also assumed the American-style cheeriness of its staff would translate well, but German consumers found it off-putting, and even creepy.

Unlocalized operating models: the hidden fourth driver

So, why exactly does international expansion underperform? As we’ve touched on, territories differ from each other in three key areas: regulatory, culturally, and in terms of supply chain. Let’s look at each.

Regulatory mismatch

To state the obvious, laws differ across the world. Businesses seeking to enter new territories must be aware of local labor, environmental, safety and data-processing regulations. Often this goes beyond simply knowing what the statutes say; it demands a proper understanding of the intent of key laws designed to keep workers and consumers safe, and to protect the environment in which you want to do business.

Getting this wrong means more than just a regulatory slap on the wrists. Penalties can be severe. State safety regulators typically have the power to shut down a factory, at least temporarily. And firms suffering a data breach can expect severe fines: in the UK, for example, these can reach up to £17.5 million, or 4% of the business’ annual worldwide turnover, whichever is higher.

But the ramifications may go still further. For a foreign business, failure to understand and comply with a country’s laws can suggest a lack of care or seriousness, and lead to a reputational backlash. The poor translation of compliance and legal materials presents a real and significant legal risk.

Cultural barriers

The workforce in Germany, for example, is different to that in Brazil, or the Philippines. Each has its own language, but also its own culture, history and identity. On a day-to-day level, this can manifest itself in anything from the seriousness workers attach to instructions or protocols, or their expectations for remuneration packages or care and rest facilities. Internal comms and procedures, particularly around high-risk activities like plant operations, must reflect this to remain effective.

This point extends to onboarding and upskilling staff – particularly important to ensuring workplace competence and establishing a deep, localized skills base. Workforce engagement drops off when these programs lack local nuance, for example where a US-market onboarding video features a US personality without global or regional appeal.

The same is true for marketing. Whether selling direct to consumers, or supplying regional brands and wholesalers, manufacturers need to navigate different expectations and understanding. It’s true for sales too; the way businesses pursue leads, build relationships and complete deals with customers and suppliers must also be locally and culturally sensitive. And for support materials like instructions and user guides, clarity and accuracy in every language are essential to ensure safe and effective product use.

Fragmented international supply chains

Manufacturing businesses can’t simply copy and paste their existing supply chain arrangements to new territories. Global expansion means both finding new partners, and working with existing ones in new ways. While this can drive cost savings – for example through greater volumes or reduced shipping costs – contractual issues can arise from linguistic or cultural misunderstandings. In the worst case, this results in delays, cost overruns or even failed deliveries, all of which can have catastrophic impacts on the venture’s success.

Poor multilingual coordination can more generally give rise to supply chain misalignment. Without clear – and clearly documented – understanding between parties, contracted quantities, timeframes and accountability can all be impacted. In today’s business environment, that can lead to anything from productivity losses, through to difficulties in accounting for Scope 3 emissions.

Plan for local realities: compliance, culture, cohesion
Manufacturers protect investments and improve expansion outcomes when they plan for local laws, labor norms, and customer expectations. Treat in-language content, market-specific processes, and quality checks as core parts of the operating model, rather than an afterthought.

• Legal and compliance: translate and adapt contracts, safety data sheets, labels, and policies; keep audit trails and version control.
• Labor and operations: tailor training and SOPs to local standards; align shift practices and safety requirements.
• Marketing and customer communication: use approved terminology; adapt offers, service levels, and support channels for each market.

Result: fewer delays and fewer audit issues, stronger team cohesion, and faster time to value in each region.

Localized regulatory compliance

Staying on-side in a new territory depends both on understanding local rules, and localizing existing policies to reflect local laws and enforcement expectations. This extends beyond simple translation; policies need changing and adapting, requiring regional expertise. A local legal review isn’t just a box-checking exercise, it’s a reputational and competitive safeguard.

Localized marketing and customer engagement

Again, adapting your messaging and marketing efforts to a new territory isn’t just an exercise in translation. It’s about gaining regional traction through regional resonance. This is a particularly important consideration when it comes to branding. Firms are understandably protective of identities they may have built over decades, but the strongest brands understand how to flex and adapt to suit regional cultures, without compromising their core identity.

This can be a challenging area, with businesses needing to look at how they win, service and retain clients through a new, localized lens. But a localized cultural approach is key, particularly as even apparently self-evident concepts can have different interpretations. Take the concept of ‘green’ business: in Europe it reflects ambitious climate targets, sustainable investment and a circular economy. In Southeast Asia, green policies consider sustainability within a more holistic approach that also values socio-economic development.

Optimized supply chain communication

Clear, in-language communication keeps supply chains moving. When policies, training, and support materials are translated and adapted for each region, local teams act quickly and confidently. That autonomy builds resilient networks that deliver value and support growth.

In time-sensitive and on-demand operations, real-time translation reduces friction in procurement, logistics, and audits. Multilingual dashboards surface global and local insights, helping manufacturers plan, execute, and adjust with fewer delays and errors.

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Strategic takeaway: building expansion on a localized foundation

There are no shortage of horror stories of international growth gone wrong, from Kingfisher’s Romanian experience, to Barbie’s failure to conquer China. However, despite the complexity of the challenge, a great many businesses have taken on new territories and thrived. Success comes through meticulous planning, and depends on precursors including diligent market research and expert risk analysis.

“Phrase made our international expansion possible. It saved us time, money, and allowed us to scale faster than we ever thought possible.”

Vojtěch Studnička, expansion director, Trenýrkárna.cz

However, the whole enterprise must be underpinned by an informed, accurate and nuanced understanding of the marketplace. Success means asking questions of any territory: how does business work there? How are employees protected? What messages resonate, and which ones don’t?

Localization serves as both a conduit for the answers, and the lever through which strategy leaders, COOs and heads of supply chain can create the business’ successful response.

“Localization is no longer an afterthought – it’s a foundation for growth. The shift we’re seeing is from language as a service to language as strategy. And that’s a very different conversation.”

Georg Ell, CEO, Phrase

Manufacturers that succeed in new markets plan for localization as early as they plan for capital investment, plant design, or supply chain mapping. It is not a final step after market entry, but an enabling layer for every decision, from regulatory compliance to customer engagement.

Expansion fails when:

• Laws are misunderstood or compliance is poorly localized.
  
• Messaging and processes fail to resonate with local cultures.
  
• Supply chains fragment under the strain of misaligned communication.
  
• The operating model assumes “what works at home” will work everywhere.
  

Localization turns these risks into advantages:

• Compliance processes are adapted, not just translated.
  
• Marketing and customer engagement are shaped by regional values.
  
• Supply chain communication becomes precise, timely, and multilingual.
  
• Operating models flex to match local market realities.
  

Expansion is never just about moving products or processes into new regions. Success depends on embedding localization as a core layer of strategy — on par with capital investment, plant design, or supply chain mapping. Manufacturers that plan for it from day one transform risks into advantages: compliance that protects reputation, supply chains that scale with confidence, and customer engagement that resonates across cultures.

For today’s manufacturers,  the equation is simple: global ambition only delivers global success when grounded in local fluency. Localization is not an optional extra; it is the multiplier that turns expansion into long-term competitiveness.