Is global expansion the next step in your organization’s journey?
The world has become the marketplace for organizations large and small. So whether you’re seeking to expand your customer base, provide a service to meet new demands locally or around the world, or find the right talent to meet new strategic goals, global expansion is often a solution worth considering.
However, there are many considerations to take in account before you make the leap across the pond or around the globe. Setting up operations around the world requires understanding more than just the language. Organizations undertaking global expansion must also navigate regulatory and compliance issues, manage international payroll and even understand the cultural norms of the region. But with the guidance of a trusted partner, global expansion not only is possible, it can be done quickly and compliantly.
Here are five things for your organization to consider as you begin planning your global expansion strategy.
Are you looking to create a brick-and-mortar location abroad? There are many requirements to understand about entity establishment before you start checking for office space vacancies.
Tax law in the region may be complex and difficult to interpret. Other issues for business may be at play, including setup costs and banking requirements. If your global expansion strategy doesn’t require a location as much as it does international talent, you may be able to leverage a remote workforce. But if you plan on hiring workers directly, and they live in the country where you plan to do business, you’ll still need an entity to employ them, and your entity must comply with all HR regulations in the target market.
While talent pools may be shrinking in the U.S., the international employment market may be more favorable for employers. Finding boots on the ground around the globe is another consideration for your global expansion strategy.
Online interviews make it easier to connect with potential hires, no matter where they are or what their time zone may be, but you may need help verifying credentials and experience for new hires, onboarding workers and managing them remotely.
Where you hire employees will determine how you pay their wages. Employees expect to be paid correctly and in their own currency, so if you plan on hiring directly, your organization must have the entity in place to pay them compliantly, as well as the local expertise to ensure all tax and benefit withholdings are correct.
Even if you plan on using independent contractors and don’t plan on setting up an entity, you still must be sure you’re adhering to all local regulations governing pay and taxes, as well as legislation defining employment—because you don’t want risk employee misclassification and the ensuing penalties.
Each country has its own employment regulations that spell out worker rights and protections. Understanding your responsibilities as an employer in your target market is critical, because you’ll want to make sure you’re protecting employee rights as well as your organization.
Sometimes even subtle nuances to employment laws can mean the difference between compliance and penalties, fines—or even jail time—for noncompliance.
Even if the benefits required or expected in the countries you’re eyeing for your global expansion strategy are similar to those where you’re currently doing business—it’s more likely they’re not—you’ll need to be sure you’re in compliance.
Benefits considerations include observance of paid holidays, parental or maternity leave options, and healthcare coverage. A consideration with healthcare, for example, is to be aware of what national health services may be available in your target market—you may only need to offer supplemental coverage.
A trusted advisor for your global expansion strategy
Partnering with a trusted advisor who’s already navigated the international business and employment landscape can help you overcome any hurdles you encounter on your road to global expansion. Look for an organization that has local expertise and an established footprint in countries on your strategic growth plan. Not only should they be fluent in the language of your target market, but also in the culture, payroll and benefits requirements, so you can expand compliantly.
Your goal is to expand your business and market share, not spend countless hours learning what’s required to do so. Contact us to speak with a global solutions advisor and learn how Safeguard Global can help your global expansion strategy today.