Hiring International Sales Teams in Foreign Countries
Expanding operations into foreign markets is an excellent way to generate revenue by tapping into different monetary resources. In such a case, hiring local sales people to represent your company in its target market is the best idea.
Successful global expansion is rooted in the efforts of a talented, remote sales force that help you break into the local market, communicate more efficiently with your clients, and consequentially generate maximum revenue.
Hiring a Global Sales Team VS Hiring Independent Sales Reps and Self-Employed Agents in Foreign Countries
The difference between different salesforces
|Foreign Independent Sales Reps||Direct In-House Sales Forces|
|Cheapest and free of legal hassles. High risk of employee misclassification with costly penalties for that.||Expensive and only companies with large budgets can afford. Setting up the company’s legal entity in the foreign country is required.|
|Reduced team spirit, less engagement with the product, independence of sales reps that will be less likely to work as a team and be productive in the long-term.||High team spirit, engagement with the products, and high productivity by retaining the best team members long-term.|
Hiring a Global Sales Team in Foreign Countries: What You Need to Know
Depending on the needs of your business, you may want to hire a team of sales people to represent your company in the foreign market which requires you to keep the following things in mind.
Sales-Teams-Specific Activities May Get Difficult to Handle
The activities of your global salesforces may vary depending on your global strategy, company product, geography you want to cover and the level of involvement you want from your foreign sales people. Most solutions can only help with a single issue like paying salaries to your global sales teams without however assisting you with questions like handling the whole scope of activities specific to sales teams. These may include administration of business trips, car allowances, mobile phone provisions, and office rent, as well as family relocation in cases when expats are sent abroad for business development in the foreign markets.
Engaging remote sales people in a legally right manner to mitigate compliance risks and exposures is only half the job. It is equally important for you to decide how you are going to stop cooperation with them. The challenge is two-fold, to ‘divorce’ your company with the sales person you no longer need and to protect yourself from unexpected rep’s resignations, which have resulted in huge profit losses for many companies.
You should also consider different types of salesforces you are going to need on different stages of growth. Foreign self-employed reps can be a good fit at the startup stage. However, if you are going to serve strategic partners, you are likely to need the best fully committed international sales professionals.
Top Benefits of Full-Time Employee vs. Independent Salesrep
A neutral body that takes over the whole scope of foreign-sales-teams activities on your behalf, regardless of the number of salespeople and countries where you want to hire them can be the best way for you to go. Companies of this kind are primarily known as Global Professional Employer Organizations (PEOs). Companies of this type are very broad in character and scope.
Global PEO Company is a single partner, neutral party, English-speaking, with international experience and standardized reporting procedures.
Acumen International is a Global Professional Employer Organization with its global network set up in different countries with established jurisdictions in all matters about HR, taxes, accounting, payrolls, compliance, labor, and employment. It renders excellent solution that is equally compliant in 180 countries. The company bears all legal, contractual and monetary human resourcing responsibilities on behalf of both the employer and the foreign worker, while reducing the whole process to a single service agreement for the employer and the employment agreement for the employee.
Some of the implications of such an organization for the globally expanding businesses include:
They can focus on expanding themselves as opposed to getting tangled in extensive legal and monetary hassles while opening their own entities overseas
They can easily deploy the right sales experts and stay in the loop about a particular country’s statutory and customary provisions (without the need to dive in local legislations by themselves)
Global sales teams’ management, including compliant onboarding, efficiency, insurance, health benefits, expenses, etc., becomes a worry-free process reduced to a single monthly invoice
A Special Twist
Employment agreement presupposes a 2-week leave notice, which can protect companies from unexpected resignations of reps causing drops in sales and therefore profit loss.
Many companies expanding internationally have already made a global PEO solution part of their global expansion strategy. Full-time employment within a global PEO solution has helped them reap the benefits of two worlds:
get fully committed international sales staff similar to direct in-house sales teams at a lot lower cost; keep them long-term
protect themselves from any employment risks (as a legal employer, Acumen Intenational bears all employment risks) and save costs required for setting up expensive business entities overseas to make direct local hiring
Compared with traditional direct sales force hiring on own entities, employment using the Global PEO solution is a lot cheaper, flexible and risk-free for the employer.
Intrenational people that you employ using our Global PEO solution is a kind of hybrid of independent and direct salesforces:
- Hired compliantly
- Dedicated and fully engaged with company product
- As the parent company’s employees, they are obliged to fulfill global strategy and advocate the brand, not simply make sales and earn a commission like in case with independent sales reps
- Lower expansion cost
- Flexibility, lean approach: companies can enter more markets, test the markets before they decide to get established there, and easily withdraw from the unattractive countries.
A strong benefit of long-term staff is that it gives you company the ability to build strong brand equity and make the company and your product recognizable in the foreign market. With short-term sales reps, you risk losing everything if the person decides to leave. In the long run, strong brand equity allows you to reduce overhead costs so that you invest less in the promotion of your products in the foreign market over time while enjoying the same sales volumes and revenues.