Multinational companies are no longer a thing of the future. As more firms seek overseas expansion, business as we once knew it is forever changed. Globalization is here and now – and it’s something that should excite all business owners. Even those who run small to midsize firms. Yes – overseas expansion is an option, possibly even a necessity, for your company’s growth.
To understand the spread of globalization, we must first explore the benefits of taking your company into international markets.
Overseas Expansion: Why is it Important?
The business landscape in many industries is more competitive than ever before. With lower barriers to entry, the Internet, and continuous innovations, it’s easier for people to start a business and find success with little experience. While there are positives and negatives to industry growth, we attribute part of the spread of globalization to the increase in domestic competition.
In addition, expanding overseas leads to:
- Cost Savings
- Access to New Talent
- Sales Expansion
- Customer Diversification
It’s up for debate, but one of the primary reasons businesses move forward with overseas expansion is for increased sales volume and revenue. There are billions of consumers in foreign markets and by entering new markets, they have access to your products and services.
In addition, if your business relies on imports and exports, you can save money by setting up an entity in a new market. The cost savings is especially beneficial for smaller firms.
Overseas Expansion: Make it a Success
There are a few key pointers to remember when thinking about taking your business overseas. All of these tips will help you avoid wasted costs, achieve growth quickly and efficiently, and diminish risks.
Plan a Solid Global Strategy
A global strategy is a must and is the place to start to get your company ready for overseas expansion.
When planning your company’s global strategy, make sure to include sections on:
- Market Entry
- Market Exit
Planning a global strategy is critical to your business’ success during international expansion. We put together a number of comprehensive posts on this topic, which you can find here.
Don’t Reinvent the Wheel
If you can’t gather already, you’re not the first company pursuing overseas expansion. As a result, don’t start from scratch. There are plenty of resources available to help you find the right direction to take to find success.
The number one tip to remember when picking a globalization partner is – check their resume. We’ll go ahead and guess that you wouldn’t let just anybody replace the brakes on your car. You want to work with an experienced mechanic. Probably someone you know and trust. Same goes for picking a global expansion partner.
When you begin researching countries to target for growth, you’ll notice that every region has different labor requirements, cultural nuances, and tax implications for international employers. You want to work with a partner that has not only general experience in global expansion but also specific experience in your target market. For example, our team works, and has experience, in more than 185 countries. We can help you solve a payroll issue in Brazil, Australia, or Tokyo because we have expertise in those different countries.
Use International PEO to Hire Employees Overseas
Managing compliance in foreign markets is tricky, especially in regards to employment requirements. If you want to hire employees to work in-house, use a service like International PEO (Professional Employer Organization). An employer of record (EOR) solution pairs your team with a third-party company that manages complexities of international employees in your new country on your behalf. Services include the management of payroll, benefits, withholdings, and taxes.
The EOR manages the nitty-gritty details, while your team takes care of the day-to-day management of your international employees. This is a great option to avoid serious penalties and complications, which can quickly arise during international employment.
We’re here to help. If you have questions about overseas expansion and want to discuss FSaaS or International PEO, give us a call!