You probably hit the ground running when expanding overseas, rather than worry about the small stuff; and focus on delivering to your customers.
So, how should you handle company incorporation, HR, payroll, accountancy and tax obligations?
It would be wonderful if there was a “one size fits all” approach when you expand overseas but unfortunately, there isn’t. All of the possible options, pitfalls and opportunities need to be carefully considered.
Do it yourself
This may be the best route for those that already have a significant presence in the country of operation; however it means developing detailed local knowledge quickly. Depending on the company’s growth plans, that may mean also having knowledge of other countries nearby which you might want to expand into next.
You will need to carefully consider the increased overheads, the delay in getting fully operational and possible HR issues. If you don’t have the local knowledge to do things correctly at the beginning, you can stunt your company’s growth and give your competitors an advantage.
Use multiple local advisors
Local advisors should have the crucial local knowledge you need and this option should be lower in cost, as you avoid having to hire anybody directly; however engaging multiple advisors to help with the various set up and ongoing compliance issues from bank account set up to annual account filings could mean you spend more time dealing with lots of individuals and then have to personally create order and manage and coordinate these relationships.
Equally, depending on a local advisor who lacks international experience could result in missed opportunities for the business. This is particularly true where advisors don’t understand the needs of large corporates. Things like adhering to central processes, reporting requirements, regular communication or even making simple conference calls can become far more time consuming.
Choose a central coordinator
Choosing an advisor who can both coordinate centrally (that is, one firm operating across multiple jurisdictions) and deliver locally through a trusted network of experts on the ground comes with lots of benefits.
One obvious benefit is the lack of in-house resource needed overseas. A less obvious benefit is visibility and control over your global operations through one point of contact and services tailored to align with the company’s way of doing things.
Generally, the speed with which your company gets up and running can be increased by up to 90 days (depending on which country you’re considering) simply by working with an experienced provider with knowledge of the local regulations, procedures, language and culture.
That local knowledge also means companies can benefit from the advisors relationships on the ground, all of which can help avoid penalties, delays and the reputational damage of not complying with the local rules.
From a corporate perspective, this model also allows a company to focus on its core activities.
In terms of disadvantages, it is rare to find firms who wholly own the operations they claim, relying instead on sub-contractors. It is also common for larger outsourcers to focus on executing the higher volume administration (payroll, for example) and subcontract other areas.
F&L do neither of these things. Where we don’t cover a specific country in-house, we will discuss this with you and enable you to choose the best route to that market.
When you’re looking to globalise, opting for central coordination and local delivery is often the best option.
Whether you are looking for a financial outsourcing partner who can offer central coordination and local delivery or you would to explore how we can help based on your specific circumstances, please contact us to find out how we can help you do business seamlessly across borders.