Five Steps to Successful Global Expansion
In today’s market, more and more businesses are looking to expand into international markets in order to grow their business and increase profits. If you have been thinking of expansion for your business, below are some reasons to consider going global and the steps to take if you decide you want to test global expansion.
Develop a Clear Business Justification and Strategy
Once you’ve decided it is time to expand into a foreign country, you will need clearly defined goals and strategies that are aligned with the reason you are expanding: whether to test the market, support foreign client(s) or because your local market is stagnant. During this stage of the process companies start their real due diligence, and begin to realize that being an employer in a foreign country can be vastly different from being an employer In their home country. Using the services of an in-country expert will fortify your strategy by providing cultural expectations and statutory requirements in the country.
Work with in-country experts (ICE) to avoid costly mistakes
ICE provide a wealth of knowledge on social costs, termination costs, statutory benefits, employee offer letters, the business environment (including the presence/strength of labour unions), culture, and much more. By leveraging an ICE, budgeting time and capital will be more precise and predictable.
Determine budget and time required for hiring overseas
By accruing for all fixed costs, including mandatory termination settlements in some countries and employer-paid pension in others, you avoid costly surprises during the life cycle of employment. In addition to cost, understanding the process to register an entity and begin operating in a country is crucial to a successful launch.
Know the culture of the country you are entering
Part of what drives the speed of business in a country is the culture. Many governments strongly support employee rights and their long-term welfare. This gives a lot of power to the employees, and creates additional administration, costs, and potential liability for employers. Having a strategy that goes a little above what is expected culturally will foster goodwill with employees and mitigate bad PR for your company.
Know the cost of establishing AND terminating operations
Whether you are planning a long-term expansion, or just testing a market to determine its viability, you need to prepare for all costs. In some countries, terminating operations can be more expensive than establishing operations. Knowing this allows you to build a thoughtful strategy designed for success; while preparing for exit costs should they occur.
With Capital GES International PEO/EOR services, your company can be operational in a foreign country in days, while reducing your risk and investment. Let our trusted team of international experts customize a solution that provides the flexibility you need, and mitigates the risks and investment associated with operating in unfamiliar territory. Contact our team today to learn the benefits of our International PEO/EOR solutions!