Starting an international company is not only a commercially exciting challenge, but can also be very profitable if you pay attention to the details. Every start-up comes with risks, but if we do it all abroad, we have to do it with much more caution than if we were moving at home.
In order to make an informed decision before starting a business, it is worth thinking about the following aspects to make sure we have all the information to get started.
What is the infrastructure and economic environment like?
We may see good chances in purchasing power in the selected country, but we also need to consider whether the basic necessities needed to run the company are available.
- Is the real estate market favorable? Can we easily find a suitable office for us, or is housing already a difficult issue?
- How is the transport? Is it easy to get from one big city to another, or is it already difficult to get to the country?
- What is the political and economic situation? Is democracy really democracy, or do we have to deal with the risk that the party that is in power could abolish the current tax breaks with a stroke of a pen?
While no one can predict what the future may bring, in addition to assessing current conditions, it is also worth seeing if there has been any drastic change in the country over the past 5-10 years. We can also learn from this whether we have to reckon with unexpected changes in the future before making a decision.
What is the local community like?
Take the time to get to know the local customs, the behavior of the people. It’s a good thing to know in advance from the news and acquaintances ’accounts, but it’s worth visiting the country at least once to see what we can expect.
- Is it easy to find a reliable workforce?
- Are there better opportunities to find employees in the field of physical labor or mental labor?
- What local cultural customs do we need to get to know?
Nothing else can replace your personal experiences, so it is worth spending at least a few weeks in your chosen country to get your first impressions of the above issues based on your own experience.
What is the local business culture like?
If we have a local acquaintance, the doors can be opened much more easily. In most countries, we have an advantage in starting negotiations when we speak the language, so it’s good to come to the meeting with an acquaintance who is at home in that country.
Non-verbal communication is at least as important. The success of a trial can even depend on how often we look our partner in the eye or how we greet him or her. All of this can be learned from books, but it’s worth a lot more if we gain local experience.
- Can we easily build business relationships or are people aloof?
- Do we speak the language, or do we have an acquaintance who can help with the negotiations and have native language skills?
- Can we rightly expect an immediate decision, or do we have to reckon with the time it takes to reach an agreement?
If we take the time to get to know all of this thoroughly and feel we can feel comfortable moving around in the business of that country, we can tick that point as well.
What are the economic conditions like?
Last but not least, it is important to know the financial terms and conditions. For example, do citizens start from a better position, are they subject to tax benefits that we would not have been able to achieve otherwise: in this case, it may be worth considering involving a local business partner for tax optimization.
- What are the local tax rules? Are they favorable enough for us?
- Are export and import opportunities adequate?
- Is it easy to open a bank account or is it too complicated / not worth it?
It is not enough to run a business abroad successfully, we also need to know how we will see our money again. It is therefore good to look at the topics of the above questions, or even whether, for example, dual citizenship can be understood because of the potential tax benefits.