Why some brands succeed in North America and others don’t
Expanding into North America can be an exciting step for New Zealand and Australian brands. The opportunity is significant, but so are the challenges. Over the years, I have seen many brands succeed in this market, and just as many struggle, often for the same underlying reasons.
These challenges are not about product quality alone. In many cases, the products are excellent. The difference usually comes down to understanding how the market actually works and being realistic about what is required to succeed.
Below are the most common issues I see when brands attempt to expand into the USA or Canada.
Assuming business works the same as New Zealand or Australia
New Zealanders and Australians are relationship driven. In our home markets, trust, goodwill, and long standing relationships often play a central role in how business is done.
North America operates differently.
While relationships still matter, they are built within far more structured systems. Without trusted and established connections, informal agreements and assumptions can quickly fall apart. Verbal understandings and handshake style deals rarely hold weight if they are not supported by clear frameworks and local knowledge.
Success in North America requires an understanding of how business is actually conducted on the ground, not how we hope it might work from a distance.
Trying to work around the distribution model
The distribution systems in the USA and Canada are complex, and they exist for a reason.
In the United States, each state operates under its own laws alongside federal regulations. Canada also has layered regulatory requirements that vary by province. Distribution channels are structured to ensure compliance, accountability, and traceability across each region.
A common mistake I see is brands assuming they can bypass or simplify these systems by applying a model that works in New Zealand or Australia. In reality, this often leads to delays, unexpected costs, or complete breakdowns in the process.
The key is not trying to break the model, but knowing how to work within it effectively and strategically.
Underestimating the funding required
Expanding into North America is capital intensive.
Exchange rates alone can significantly impact budgets when converting New Zealand or Australian dollars. When freight, warehousing, marketing, compliance, staffing, and ongoing operational costs are added, the financial requirements increase quickly.
Many brands get partway into the market only to discover they do not have the resources to continue. This can stall momentum and, in some cases, damage long term opportunities.
Having realistic funding in place from the outset is one of the most important factors in setting a brand up for success.
Misunderstanding employment and operating costs
New Zealand and Australia operate within socialised systems where healthcare and many employee benefits are built into the structure of society.
The USA does not operate this way.
Employers are responsible for providing benefits such as health insurance contributions, retirement plans such as 401(k), paid time off, and other employment related costs. In addition, the cost of living in many parts of the USA has increased significantly in recent years.
Building a team or engaging contractors without fully understanding these realities can be confronting and expensive, particularly when costs are continually converted back into local currency.
A final perspective
None of these challenges are reasons not to expand into North America.
They are reasons to expand with clarity, realistic expectations, and experienced guidance.
When brands take the time to understand the market properly and work with people who know how the system operates, the opportunity in North America can be significant and sustainable.
For any questions about the above or to discuss your brain further please reach out
Dan