There is a time when your export trade grows to the point that you require an overseas office to handle it. But there are many considerations before you open the doors.
Once you choose to export overseas, there are plenty of decisions to make.
First of all, don’t act in haste; you have to give yourself time. Don’t go by the lines of other companies, which take an instant decision to open international office, and then look for the staff.
Actually, the process of starting a business or selling one takes longer than expected. However, it is impossible to say how long it will take, as it depends on the particular nation’s business ecosystem and jurisdiction.
Be open to devoting more time, money, and patience to acquaint with your target market. It is a not a kind of project you will start and finish within a short span.
Presenting you the basics which can help you establish your business on a foreign soil:
1. Be sensitive to local markets and cultural norms.
Each nation has its own business norms and standard, so don’t generalize the market strategy as per the nation’s policy.
Specifically mentioned, things like employment laws, benefits, and entitlements, and data-protection regulations differ from nation to nation, and everyone has to follow it.
You will also observe differences in employee commitment. Like the fact that manpower of developed nations isn’t susceptible to job hopping. While the manpower of developing and underdeveloped nations could switch their job, even a paltry hike of 5 %. So always consult the experts and take advice from others who already moved overseas.
2. Know your tax responsibilities.
Every development in business leads to taxation. So the key here is that you have to choose an entity structure which keeps you in compliance with local tax regulations and can minimize your tax liability.
This area is very critical as you take risk and face intricacies. However, many countries have already made their tax structures and system relatively easy. Still, though, some nations have a lot of complication in their tax structures and you have to spend a lot of time to get it done for you.
3. Plot out your sales strategy.
Don’t go by the approach of one-size-fits-all. Choose a right approach as per the nation’s business policies through partnership, franchising or having employees on the ground. Be aware of the contractors.
4. Know the laws and regulations.
When you’re about to enter a new country, you have to be acquainted with all the rules, which can affect your exports.
Find out if there is any need to outsource any compliance authority. Always keep one thing in mind: that lessons learned in one country hardly help you in another one, as each country has different criteria for filings and submissions.
So if you want to make a statement and focus on growth, then outsource all the back-office tasks, in order to work more on the strategic part.
5. Decide where to and how to market.
Find out if there is any need to send an executive, a sales representative, or a marketing guy to the country you’re about to open your business in.
If you need it, that’s okay. But don’t go blindly for it, as it depends on your specific objectives and the type of customers you want to target.
As a general rule, if you will be selling directly to customers in-country, you need to establish an entity. The same strategy was applied by the Gupta family of South Africa by sending some marketing representatives to evaluate the target market before doing any business in the new country.
Apart from these points, there are some others worth mentioning when starting a business in a foreign land.
- Learn the local language.
This will help you to settle down fast on a foreign soil. You can form local connections by sharing your ideas.
- Explore the new community.
Doing this will give you a sense of control in an entirely different culture. Through this acquaintance, people will accept you in no time.
In a nutshell, establishing a business on a foreign soil is an exciting experience, as you get to explore an untapped market and new heights for your business. And if put down your foot with care, you will reach success.
About The Author
This is a guest post by Nosicelo Mntumni.