The deepening trade liberalization and many agreements between countries give us an array of possibilities to do. We are able not only to travel abroad but also start an international business. It is a good idea for people who want to expand into global markets, reach a new segment of customers and build the brand. Sometimes, the procedure we are obliged to follow in other countries when we think about starting a business abroad is more propitious for us, e.g. less paperwork or less special requirements to become an entrepreneur.
1. How to start a business in another country?
Doing business in another country can turn into a profitable solution, but we also need to face some difficulties. If you are looking for a guide which shows you steps how to open a business overseas, follow the lines below and find out what you should be expected for.
2. Five steps for starting a business in a foreign country
What is the very first advice for the beginning? Be patient. It might sound obvious but patience has a huge meaning. You need the time for getting to know customers, competitors, trends and demand for your products or services in the chosen country. Be prepared for carrying out many types of research. When you would do it in a comprehensive way, you could save some time, money and energy. Pay attention to the presented steps:
2.1 Define your business and find the country
Before the opening a business in another country you should determine the plan – what you would be dealing with? Are you going to sell products? If so, where would be the warehouse? How about shipping procedures? Do you want to handle brick and mortar shop or put your items on marketplace online? Or maybe you want to focus on services? Then, ask yourself about the employers – who should be in your team?
As we can see, there are many questions we need to answer. Depending on the type of business and category of products or services, we should pick a country where we have a chance to succeed. For example, selling skis in the Republic of South Africa would not be a good idea – it is better to trade this kind of articles in mountainous countries like Switzerland or France.
During looking for a proper country, pay your attention to the economic situation and political issues of the country. Choose a place with stable policy, where the problem of bureaucracy is inappreciable and legislation is not complicated and does not diametrically change from day by day.
2.2 Learn from others
You can unique some mistakes when you would get a piece of advice from experienced entities. If you don’t know any entrepreneur who has some background in starting a business in another country you would find many blogs of people doing international businesses – on the websites they share their views, stories, and counsels.
What is more, you could get in touch with entities from a foreign country, which makes business locally. Maybe they do not know about difficulties connected to handling people from different culture, but they would surely know the taxes issues and legal procedures.
2.3 Make sure you are legal
What is a necessary element of opening a business in a foreign country? Legality. It regards your entity and products or services you want to deal in. Get familiar with all requirements in the country – from immigration procedures, issues related to the establishment of your business, to special certifications and permissions. To make sure, your operations are under the law, you can always seek the legal advice of expat lawyer. This is a proven source of information which would save your time – you do not have to navigate the internet for finding proper acts and regulations. Furthermore, in that case, you do not bother your head about distinguishing between authentic and false information.
Be sure your services or products meet domestic conditions. For example, when you want to launch food in European Union markets, your product label cannot mislead a customer. You need to present all used ingredients, the country of origin and the list of allergen. What is more, the label must be readable and clarify, so placing some sticker interrupting a component is not allowed.
2.4 Check all taxes responsibilities
The thing we love the most – taxes. It is an inevitable part of every business in every country. While doing business in other countries, there are also different types of entity structures you can choose to become. Scan all possibilities and try to establish your business in a way which let you minimize the sum of taxes as much as possible. In this quite complicated field, it is also a good solution to ask for a piece of legal advice. Expat accountant shows your advantages and disadvantages of the chosen option and resolves your doubts. You would know all information about payments and, in consequences, avoid pecuniary penalties for misunderstandings.
2.5 Remember about cultural differences
Keep in mind that products which are bestsellers in one country might be a misfire in another. Customers expectations are different and can be the result of the economic situation of the chosen country, trends or tradition issues. The example might be selling pork in Saudi Arabia – that is not the right idea for starting an international business with this kind of product there. As we know, Saudi Arabia is a Muslim country where religion adamantly prohibits pork eating, so you trading this kind of meat equals a failure.
Differences would also be visible when we think about employment matter. There are countries, where you can find a cheap labor. Even when you propose them a few cents more per hour than hitherto, they would agree to work for you. Before you start a business overseas think about employees you need to have in your team and check salaries for several positions in that foreign country.
Naturally, there are also differences in languages and business behavior. We should find out information about business etiquette in a particular country. The inherent part of doing business is entering into communication with other entrepreneurs. With the aim of professional presentation of yourself, get to know how to behave in business meetings. For example, you have chosen China for your country business, so now take a moment and check how to behave in this place – in China exchanging business cards is a common practice, so you do not forget about taking some of them with you for a meeting. In addition, always be prepared for a meeting – print copies of your presentation and do not be late. Pay your attention to the dress code and wear only conservative suits as a sign of respect.
In general, the language barrier is something we can easily face with. Almost every businessman can speak English, but there are also countries, where communication in a foreign language might be a problem. In this case, you can always use the services of a translator and be sure you seem professional and make a good impression.
We have presented some steps on how to start a business in a foreign country. As you can see, this is a long process, but if you have a good idea for your entrepreneurship and choose a proper country, where your services or products have a chance to be sold in the most profitable way, it would be worth. Do not forget that next to this brilliant idea, another necessary thing (apart from budget) is a patience. Carry out detailed research and ask for advice other experienced businessmen. We hope that hard work would bring dividends and your international business start thriving as soon as possible!