Establishing A Local Presence Overseas Without New Subsidiaries In 190 Countries
Expanding your company’s international reach can become a priority for a variety of different reasons. Some of the most common ones include:
- Having your own overseas clients and needing to better support them. A good example of this is international tech support.
- Looking to acquire global talent like skilled foreign professionals distributed globally.
- Sales growth. Many companies want to expand to enter new markets and see potential trading activity.
However, many companies end up trying to go too far, too fast, with poor results. Here’s how to avoid that fate.
Setting The Stage For Incremental International Expansion
Incremental expansion is key when trying to build up your company “the right way” in new markets. In fact, if you’re on a limited budget, it may be the only want to balance efficiency and effectiveness. For the most part, companies that want to get into a new global market, especially smaller firms, begin with independent sales agents. Each of these agents will work with local customers, with a list of clients on-site. From there, they are ready to promote and offer your product/services.
Your average independent agent works on commission, just like an independent contractor may bid for a job. As a result, the company ends up only paying based on the volume of sales that the agent makes. This is a positive, but the major drawback is the risk that comes with your reliance on an independent professional. If the said agent decides to leave the country or not to work with you anymore, you lose all the headway with those clients. You can’t even pick up where they left off with a new agent, because they have the client list, data, and connections.
The Need For A Global EOR Service Provider
So, what’s the best fit for a company with those needs? Some may recommend starting your own local subsidiary, but this is expensive and time-consuming. A global employment company/EOR service is the perfect match, allowing companies to get started, while keeping things small. The unique solution that Acumen offers allows you to onboard and payroll a global sales force in 190 different countries, as employees, versus independent sales agents/contractors. As a result, you don’t have to worry about factors like legal compliance or losing client data/intellectual property. A proper PEO company keeps you safe, with a lighter footprint. Using a third-party foreign employment, incorporating in the countries with the highest growth potential. In addition, this service allows you to legally bring on a new team without having to actually own any companies abroad.
As a result, if you’re looking to grow international business slowly, business process outsourcing (BPO), is a great asset. For example, say that you were breaking into a new market, but only needed 15 sales agents as employees to start. An EOR in this initial stage will allow you to stay compliant while you begin to make a headway and amass clients. After that, if you’re happy with your progress, you can begin to open up your own entity. Another advantage of note here is that if you’re not happy with progression, it’s a lot easier to withdraw, with minimum commitment. In essence, employee leasing allows you to test out a market before deciding to incorporate.
Say that companies understand that they will eventually need to incorporate. It still may pay to wait. Different countries have their own idiosyncrasies when it comes to labor regulations and other laws. An EOR allows you to walk that balance between starting operations and engaging your sales force on-site while still learning how business in the new country really works. Many companies fail due to not understanding the local business culture. However, a good EOR service already knows how this works, and can be an invaluable resource during this initial period. In theory, you could have a flexible yet compliant way to set up internationally overnight.
Overall, an employment outsourcing solution is going to be your best option to start building in overseas markets without the additional expense and headache of a new company branch. For the ideal option here, be sure to use Acumen International is your ideal choice. We service 190 different countries, allowing you to stay compliant without the added need to open a business entity. We also serve as a one-stop-shop for services when you do get established through hiring and paying foreign people, from office rent, housing, car and mobile phone provision to training support.
Reach out to us today for more information.