When it comes to international expansion, businesses are both excited as well as concerned. They know that expanding existing business operations to a different country can help with growth, success, and profits. They also know that the same can be a daunting and risky endeavor, that can result in losses, both financially as well as in terms of reputation.
The global world markets are expanding thanks to technology, digital integrations, and internet communications. Better global economic policies and friendly pro-business stances adopted by national governments have made it easier to set up shop in a different part of the world. While this has become simpler, there are nevertheless hurdles that businesses need to contend with.
A new country is characterized by a set of cultural policies and practices. It also has its own defined financial and taxation policies. Additionally, you will also have to hire and work with a multicultural workforce. In this article, we are going to look at five important tips that can help you establish an international presence.
List of 5 Important Tips to Set-Up your Business Internationally
1. Pay attention to the Cultural Norms of the New Country-
Every business operates in a cultural environment that is specific to its region. This means that when you will start operating there, you need to follow the day-to-day cultural policies and regulations. This can include the normal off days, holiday schedules, as well learn the sensitivity to work with a multi-cultural ethnic group that might not be similar to yours.
In some cultures, professionalism and hierarchies might be more stringent than in other parts of the world.
2. Work with a Local Legal Expert or Law Firm all the time-
You cannot expect to know everything about a new country on Google. This is why working with a locally based law firm or legal experts can help you navigate the judicial regulations in the new country. For example, if you want to expand your business operations to Dubai, you need to work with the top lawyers in Dubai. They will be able to guide you on legal matters like incorporation, taxation, employment laws of the land, and more.
3. Have a detailed idea about the challenges and obstacles-
For many businesses, expanding to a different country comes with its own sets of operational and logistical challenges. Food businesses, for example, might not be able to get their hands on the same sets of ingredients in a foreign country. Flying the same out might not be the most economical thing to do. This is why having a detailed idea about all the challenges that might confront your business in a new country should be laid out in front of all the decision-makers.
4. Evaluate the investments and look for government subsidies and benefits-
Starting business operations in a new country requires considerable investments. The size of scale of the business you want to set up definitely plays a role. Businesses can reduce the financial burden by looking at countries that have Free Economic Zones in place.
Some nations like the UAE have a no-tax policy for businesses in all niches apart from banking, hotels, and oil. A relaxed tax structure can help you make sense of your investments and growth.
5. Do not make profits the only reason for planning your expansion-
Some of the world’s best companies move because they do not prioritize profits. In contrast, they look to move for other reasons like a better talent pool, cheaper natural resources, better connectivity, and more.
Once you are able to establish the core reasons for the expansion, you will be in a better position as compared to the planning and execution. Expanding for the right reasons will help you automatically generate revenues and profits for the business.
The Bottom Line
While this is something that can be incredibly challenging, it can also be highly rewarding. Every year, thousands of businesses of all shapes and sizes decide to start operations in a foreign country. While some fail, others are able to succeed. If you have any questions that you would like us to respond to, please let us know in the comments below. We would be more than happy to help you out set up an international presence in a country like the UAE.