If your organization is considering a move into the global marketplace, no time is better than the present. According to the fourth annual Wells Fargo International Business Indicator, 81% of U.S. companies expect their international growth to increase during the next 12 months, which is nearly a 20% increase from 2016. In addition, with continuous advancements in technology, the incentives for businesses to expand into new global markets are becoming more desirable and advantageous.
As the benefits of international growth seem hard to pass up, companies must understand the labor regulations in the countries they expand to. When entering into unfamiliar territories there are a number of risks, especially regarding the proper management of compliance and legal regulations. To defeat these obstacles, many companies choose to partner with an International PEO (Professional Employer Organization) to help with international risk mitigation. Here’s how this Employer of Record service can help your company have a successful market entry and international growth.
Faster Market Entry Leads to Faster International Growth
Establishing a legal presence overseas can be a long and expensive process, especially if you use a foreign subsidiary. Creating a full commitment in-country helps your organization gain trust from the local market, but comes with its own associated risks and downsides. If you choose to enter the market with a foreign subsidiary, you are subject to all legal, accounting, and tax obligations. There is also significant commitment through time and cost. On average, it can take three to four months to set up a foreign subsidiary and can cost up to $20,000.
If your organization opts for a more agile method to international growth, such as International PEO, you can save a significant amount of time and money. Entering the market quicker will give you more time to start implementing your strategy.
Maintain Compliance with International PEO
When expanding into a foreign market, companies must value the processes established by foreign labor laws. Driving sustainable international growth relies on two key functions including global marketing and localization. Companies with the most success overseas prioritize these areas, usually by assigning a team or partner like International PEO to manage compliance.
Compliance management is a big task that should be navigated by a true expert that has applicable experience in the market. Don’t reinvent the wheel when you can work with a team that has the knowledge and tools to help you find success during international growth.
Benefit From the Expertise of In-Country Partner
Companies with strong performance overseas tend to have a member of their team who is either from the foreign country or has direct experience working in that market. Global partners or direct team members make a significant difference. There are many multinational organizations such as Google, Facebook, and Microsoft that have foreign nationals that help them navigate the global business landscape.
Successful international growth is all about building partnerships. Carefully choosing these relationships is important at the onset of entering markets overseas, especially when trying to push out competitors to become the market leader. If you’re interested in finding a partner that can help your company begin its journey towards international growth, contact our team of global experts. We can help you understand what you need to do to get into your desired market — quickly and compliantly.