Finance Monthly July 2019 Edition

44 www.finance-monthly.com BUSINESS & BANKING - INTERNATIONAL EXPANSION nternational expansion features heavily in many businesses that are in their growth phase and is about more than just establishing an overseas branch or subsidiary, or deciding on which market to lay roots in. While tech firms lend themselves to cross border activity by enjoying a high degree of seamlessness and scalability, other knowledge- based businesses can also enjoy the benefits by outsourcing certain back-office functions or cultivating international sales networks. By accessing new markets, trading overseas can substantially grow revenues, reduce the cost base by sourcing cheaper products or services, and provide access to new sources of finance and investment. The rewards can be significant, but it’s vital for business leaders to properly plan and execute their expansion. The process can be costly, with errors causing substantial losses and diverting attention away from the main priority of growing the business. The value of financial modelling Businesses should be crystal clear on their vision for expansion and the key drivers for making that cross-border step. Being able to consider why they are looking to expand makes it easier for businesses to answer the more practical questions of how, when and where. For every successful expansion, there has been another that has failed because the benefits and risks had not been properly identified. Three key elements are the strategy, business plan and financial model. Business leaders are typically excellent at articulating the first, good at As the continued uncertainty over Brexit offers little clarity on the future of the British economy, expansion into other jurisdictions poses a daunting prospect for UK businesses looking to scale up. Despite the current political and economic uncertainties, the UK is still a good stable place to domicile as a holding company, says Chris Cork, Director at haysmacintyre. A common misconception of international expansion may be of only large multinational businesses moving seamlessly between territories. In fact, 340,000 UK businesses trade internationally, 98% of which are SMEs. I BEYOND THE GARDEN PATH: Chris Cork, Director, haysmacintyre HOW TO GET READY FOR INTERNATIONAL EXPANSION