International ambition makes sense post-covid, but make sure you are fully prepared to meet the challenges ahead
By Rhys Madoc, CEO, UHY International
Albert Einstein’s assertion that “in the midst of every crisis lies great opportunity” is perhaps a crumb of comfort in the harsh Covid-era commercial landscape. Business is suffering through the crisis, but vaccines and better treatments have brought hope that the worst might soon be over. Companies have started looking to the future, at opportunities to build back better, and many organisations are now eyeing international markets as part of their post-Covid plans.
spread the risk, take the opportunities
Covid has revealed the risk of depending on a single national market. Countries have been impacted to different degrees, depending on factors such as population density, mobility, healthcare systems and the effectiveness of government action. Yet international businesses have been able to keep trading in one country and even on one continent, while operations elsewhere were suspended for extended periods.
And the continued benefits of international expansion still apply. Manufacturing or selling products and services across borders opens up new markets, creates economies of scale and diversifies risk. E-commerce has made accessing global customers easier than ever, offering what can appear a world of almost limitless opportunity for expansionist businesses. Building operations in new jurisdictions is a post-Covid strategy that can make a lot of sense.
Fortune favours the well informed
Overseas expansion will always be a calculated risk, but it is a risk stacked in favour of companies who are properly prepared. For all its potential, moving into new markets is not a quick fix. It takes investment, planning, time, and on the ground expertise. If you do not want to run up against hurdles from the very start, make preparations early and ask advice.
trading and complying
The challenges of simply buying and selling in another country - from unfamiliar tax regimes to the deal-clinching details of foreign business etiquette - are easy to underestimate. Even the localisation of web content or sales materials can be a complex task, and there are many questions that you must have answers to, such as how well your products and services are known, what is required to secure effective distribution, and how sales cycles differ from those you are used to. You need to understand how reliable the communications infrastructure is, including transport links and broadband services.
Most importantly, you must access, understand and comply with local laws and business regulations. The challenges of local production are greater still, and establishing a way forward to acquire, for example, the workforce you need, means local knowledge is paramount.
Ask the experts
In all these areas, and more, advice from a knowledgeable and trusted third party is invaluable. UHY is a global network of accountancy and consultancy firms operating in over 100 countries with offices in nearly 330 of the world’s major business centres. When you contract the services of a UHY member firm, you not only get all the local knowledge you need, but also access to the collective knowledge of commercial specialists from around the world. This means whatever your challenges, our member firms will have solutions.
35 years ago the UHY network was founded to help businesses take advantage of new opportunities overseas. Ever since, our member firms have been working closely together to make sure clients enjoy long term cross-border success.
think global, plan local
Early local input to your strategic and operational plans can make a real difference. Market research, an identification of customers, competitors and sales channels, and a thorough risk and opportunity analysis will ensure your first approach is sound. Exploiting foreign markets takes time, focus and investment. We believe you should leave nothing to chance.
As your plans progress, our member firms will guide you through the practicalities of business in your chosen market.
They can coordinate with government bodies on your behalf to ensure compliance with the full range of local registration and filing requirements. And when your overseas operation is up and running, our offices can help you meet local accounting and auditing requirements, accurately and on time.
The significant complexity of multiple tax regimes can quickly become a barrier to overseas ambitions. Crucially, UHY tax experts will ensure you are paying the tax you need to pay, and never more than that. Issues of transparency, country-by-country reporting, profit repatriation, foreign tax credit systems or internal trading compliance and transfer pricing should only be handled by specialists with the required local expertise.
In the early stages of setting up an international operation, relocating senior staff to the new location creates challenges not just with income tax, but also with interpretation of different labour laws, definitions of citizenship and the rights and responsibilities of residents and non-residents. UHY member firms are well versed in the intricacies of human resource management and a comprehensive range of expatriate and mobility services includes international payroll, personal tax, advice on remuneration and benefits based on local circumstances, and social security implications.
UHY is a global network with a global vision: to become the first choice trusted advisor for our clients and future clients all over the world. We are the network for doing business locally, nationally, regionally and internationally. Helping businesses find new revenue streams and customers in another country, or on another continent, is one of the most important roles we play. If you are looking to expand overseas, you can rely on a network with global ambition at its core.
Check out these publications, and more, on our website:
UHY Global magazine – our twice-yearly business magazine on hot topics around the world
UHY Global Directory – detailing every office in every country, with full contact details
UHY Doing Business In… country guides – a great place to start your international journey
UHY Capability Statement – featuring case studies from our clients’ point of view
Why UHY? – a quick guide to the benefits of choosing UHY as your trusted advisor
Construction image by Jamie Street on Unsplash
Co-workers with laptops image by Annie Spratt on Unsplash