Expansions are lost in the first two years. Most of the reasons are settled before day one.
We reviewed the published research on why international expansion fails and why it succeeds: meta-analyses covering more than 120 studies, research on more than a thousand major corporate decisions, and multi-country surveys of more than 20,000 companies. Ten reasons for failure recur. Seven of them can be tested by the leadership team before anyone is hired, any entity is set up or any contract is signed.
The exposure window is the first 24 months.
In the first two years, the hard lessons arrive faster than the team can resolve them. That is where an expansion fails or retreats. What happens after that is a different set of problems, and we treat it separately.
Lessons outpace answers
The buyer behaves differently, the forecast slips, the owner is stretched, the rules bite. Each problem lands before the last one is fixed.
Different problems
Scale, competition, succession and strategy shifts. Real challenges, and outside the scope of what we call expansion failure.
What the research says leadership teams get wrong.
Process beats analysis.
Across 1,048 major decisions, most of them acquisitions, reorganisations and moves into new geographies, products and services, the quality of the decision process mattered six times more than the quality of the analysis.1
The obstacle is inside.
Across global surveys, 85% of executives said the main barriers to profitable growth were internal. At companies above US$5bn of revenue, it was 94%.2
Which of these ring true for your plan?
These are the ten reasons that recur most often, and with the strongest evidence, across the research, ranked by the strength of that evidence. Each is written the way it sounds inside a leadership team. Tick any that apply to the move you are considering.
The top two are linked. The model fails to travel largely because the forecast assumed it would. Where both ring true, test those first.
What the expansions that work get right.
The same research identifies ten recurring success factors, ranked the same way. Two of the three strongest sit with the leadership team.
Ten recurring reasons expansions fail
7 tested directly. 3 surfaced and priced into the verdict. None outside the review.
Ten recurring reasons expansions succeed
7 tested directly. 3 surfaced, with the gap and the remedy named.
More companies are moving, under rules that change faster than plans assume.
New trade barriers have more than tripled since 2019.5
Yet global connectedness held at a record level in 2025. Companies are still expanding, into new corridors.6
of mid-sized and large firms across 18 markets plan to enter a new country within two years.7
The companies that get through the first two years will be the ones that tested their assumptions before the rules moved under them.
Five questions to put on the table before you commit.
One for each stage of the review, in the same order: Strategic, Commercial, Leadership, Execution, then the decision.
Why this market, why now, and what happens if we do not go?
If the honest answer is that a customer asked or a competitor moved, the case still needs a thesis of its own.
Which are the three most significant numbers in the plan that came from our home market?
The assumptions that do not travel are usually the ones nobody thought to check.
Who owns this, and who has argued against it on the record?
Support is not ownership, and an argument nobody has made is a risk nobody has tested.
What would make us stop, and who is allowed to say so?
Gates and decision rights set before launch are cheap. Set after the first crisis, they are expensive.
Who is the most challenging gatekeeper, a board member for example, and what will it take to convince them?
A decision is only as strong as its hardest sign-off. The Board-Ready Decision Memo is built for that conversation.
A method you can check.
The ranking
We coded every reason for failure and success in each source to a common list, then ranked them by how many independent sources support each one and the quality of those sources. We used only evidence that spans several countries and several industries. A reason counts as tested directly only where a DunDrake review diagnoses it and produces an output that addresses the decision. Every reason and success factor is also tagged to one of the four stages a DunDrake review works through, Strategic, Commercial, Leadership and Execution, so each finding on this page maps to a step in the method.
What we leave out
You will not find "70% of expansions fail" on this page. It is widely quoted and we could not trace it to any study. Where regulation, tax, currency or local hiring need specialist advice, we say so, name the gap in the verdict and take no fee from whoever resolves it.
- Lovallo, D. and Sibony, O. (2010) "The case for behavioral strategy", McKinsey Quarterly. 1,048 decisions over five years.
- Bain & Company Barriers and Pathways to Sustainable Growth. Executive surveys of 325 and 377 respondents across North America, Western Europe and Asia, fielded in 2011.
- Flyvbjerg, B. and Gardner, D. (2023) How Big Things Get Done, drawing on a database of more than 16,000 projects, summarised here.
- Lovallo, D. and Kahneman, D. (2003) "Delusions of Success", Harvard Business Review.
- Gopinath, G., IMF (May 2024) "Geopolitics and its Impact on Global Trade and the Dollar".
- DHL and NYU Stern (March 2026) DHL Global Connectedness Report 2026.
- HSBC (2026) International Business Expansion Study. 2,703 decision-makers, 18 markets, US$50m to US$2bn turnover.
- Ranking also draws on Schmid and Morschett (2020), meta-analysis of 45 studies of foreign subsidiary divestment; Arregle et al. (2017), meta-analysis of 76 studies across 41 countries; the European Commission's 2025 survey of 17,000+ firms; and PwC's 2025 survey of 1,325 family businesses in 62 countries.