Global Business Expansion DOs and DON’Ts
Your business is expanding globally! Where do you go for advice? Who can guide you through the processes? Do you do everything yourself or outsource the processes to establish yourself in foreign jurisdictions?
For the last 15 years, Canada-based Payroll Solutions International Inc.has been building a global network to offer effective services and support for global expansion in all types of organisations. The company’s involvement in this area of business over the past 15 years has taught the team a great deal, including what not to do. Bellow, President and CEO Michael D. Cote shares his top six rules to follow if you consider global expansion.
Rule number 1: Do your research.
You need to use the tools that are available through the Trade Commissioner of Canada and Export Development Canada (or the equivalent of these bodies in your jurisdiction) to understand the markets you’re trying to enter as well as the pitfalls. Doing the research will save you time and money while correspondingly reducing the number of mistakes.
Rule number 2: Get representation.
You need to have representation in the local market you’re trying to enter by way of agents and advisers. First and foremost, you need local accounting and business formation advice before you spend any money setting up a local branch or subsidiary. Most CPA firms around the world can provide extensive advice on business formation for foreign companies. Don’t go and set up your company until you have received this advice. Going directly to a local law firm to launch your company will often leave out several necessary steps. It’s better to work with the Accounting firm first, then follow up by adding the law firm to set up your company. Global advisory firms who do this kind of work typically provide both services in-house
Rule number 3: Don’t assume you can get a bank account for your business in that market.
One of the biggest headaches in global expansion is banking. It’s not an easy process in most countries – in some countries it’s due to anti-money laundering legislation, but most of it is just plain logistics. You need to have local representation on the bank account if you’re going to be successful in getting the kinds of services you need.
Rule number 4: Be clear about what you are offering.
You need to research whether you can sell your product or service in that jurisdiction before you attempt to do so. If your business is a tangible product seller, you may require a local agent. If you’re a services company, you may be restricted in delivering your service by whatever trade agreements are in place with that country.
Rule number 5: You need to understand local labour requirements.
Expanding globally requires an understanding of local labour laws and hiring practices. Labour legislation can be complex and can contain serious penalties for transgression. Hire advisers who can walk you through the process and document what is required.
Rule number 6: Understand your financial requirements.
Get your finances in place beforehand and make sure that you have export insurance on your receivables. By going through this process at the beginning you will avoid losing money, particularly if you experience unscrupulous customers who attempt not to pay your bill.
About Payroll Solutions Inc.
Payroll Solutions International Inc. is a member of the Amesto global network, operating in more than 100 countries around the world. Through this network, PSII can offer employer and corporate services to organisations expanding globally through a combination of local representation and technological applications.
Payroll Solutions International Inc. (PSII)
557 Massey Road
Guelph, ON, Canada N1K 1B3
T: (519) 822-4351
F: (519) 821-9785