Scale-up Guide: Top 10 tips to scale your business in new territories
International expansion will have been extremely challenging in 2020 with many companies shelving plans until 2021. Expanding in new territories will be a great way to supercharge your growth, but you should also be aware of the risks involved. Read our top 10 tips below.
The reason may be the location of existing clients, key employees or the fact that you have fully penetrated your local market and therefore need new locations to grow.
2. Do your research
Not all products and services are transferable to new locations. To make a success of your new overseas venture, consider testing the market with perhaps one client or a sales representative before investing straight away in an entire team.
3. Don’t underestimate the value of distributors
The use of external distributors on the ground can be a good, cheap way to sell your service overseas. They may already be set up and understand the local market.
4. Embrace local ways of doing business
Be aware that different countries have different approaches to business. Although you’ll want to keep your overall company ethos and culture the same, adjustments will need to be made to reflect the practicalities of trading in a new location.
5. Don’t try to do everything remotely
There’s no substitute for meeting clients and suppliers face to face, so be prepared to build business relationships locally.
6. Keep involved
Opening in new territories brings risk, so you as a founder should be highly involved. Alternatively, if you can’t monitor development yourself, make sure you have someone you trust to oversee the operation.
7. Get local advice
It is vital that you have advisers and employees on the ground who can help you to navigate through local laws and other commercial requirements. They can provide advice on how processes are managed locally and their knowledge will save time and cost in the long run.
8. Set up a local company
Given the risks of doing business in a new location, setting up a local company is a sensible option as it should reduce the transfer of risk to the rest of your business.
9. Be aware of local tax laws and get sound advice
Most countries will have their own bespoke rules covering complex issues such as foreign ownership, distributing profits overseas and determining whether you have a permanent establishment in their country.
10. Don’t spread yourself too thin
Expansion can be timely and expensive, and it can end up causing more pain than it is worth if not executed properly.
Buzzacott are a member of PrimeGlobal – one of the largest international associations of accounting firms in the world, with approximately 300 members in over 80 countries. Through PrimeGlobal we can introduce you to local trusted advisers in most major locations throughout the world. Find out more here: primeglobal.net
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