As companies all over the world have faced unprecedented business interruption over the last 18 months, many organizations put international expansion plans on hold. Now that economies are improving and business operations are returning to pre-pandemic levels, plans for expansion might be brought back to the table. Here are some common international expansion challenges to be aware of before you get started.
Production and international shipping have been severely impacted by the pandemic. Companies may have to source materials or supplies from several vendors and across multiple countries. It is important to look at timelines and supply chains for ordering specific supplies that you may need to get your new organization off the ground in a specific country. companies need to determine what their game plan will be.
Starting up a new location in a new country involves many unique regulations and requirements including business entities, employment contracts, statutory benefits, taxes, and national insurance or pension schemes. Knowing what you need in each country before you start hiring employees is vital to ensure compliance with local in-country regulations and to avoid fines or penalties for non-compliance. If you don’t have a global compliance team in your organization, you will need help with compliance for each country.
Payroll is the other big component of expansion. Are you sending in a team from the US or will you hire in-country talent? Each employee must have the right pay, benefits and national requirements based on their status in the country. If you have payroll across multiple countries, using different vendors in each country can be expensive and lack the visibility and reporting that you need as an organization. Using one platform for global payroll is the best way to maintain control, view payroll in real-time, and get aggregated reporting each month across all countries and currencies.
For some companies, this whole process is new, but for others this may be just one more country to add to a long list – either way there are specific and unique regulations in each country that you may not know about or understand. Finding the right partner to navigate global expansion is key to optimizing your operations right from the start.
Author – Blue Marble Payroll