It used to be a long process to start a business in another country, but today it is easier than you may think. As Shahram Shirkhani will tell you, it may be more economically sound and less risky setting up an international business that starting one in your own country. There are emerging markets all over the world that are suitable for small businesses as well as large corporations. Here are some key points to consider when starting a business overseas.
• It is recommended to make sure the country you are considering allows foreign businesses to own property. It is better to avoid countries that have a history of confiscating property owned by a foreign company. There are plenty of countries that have solid property rights and welcome entrepreneurs.
• You should do some research about the debt-to-GDP ratio, the unemployment figures and consumer spending before selecting a country. If there is a growing middle class, rising incomes and low inflation, it is most likely a good prospect. If the economy is faltering, your business could falter too.
• It is best to invest in an industry in which you have some knowledge. It is not necessary to be an expert, but you shouldn’t solely depend on managers employed from your target country. However, it’s important to find managers who are expert in the field to increase your chances of success.
• You’ll need to do some market research in your chosen country and maybe have a trial run or conduct surveys to see how your product fares. It’s essential to know how much capital is required for marketing, the work habits of the country and salaries.
• If there is a language barrier between you and your chosen country, it is better to employ a bilingual person who can translate both every day issues as well as contractual issues. It is not recommended to employ a temporary translation service as these can become very expensive and not give you all the help you need.
Whether your business is small or large, it is recommended to look at the International Finance Corporation and the World Bank websites for the costs, procedures and time involved in forming a business in 183 countries. Some countries make it extremely easy such as Australia, two days, and New Zealand, one day. Other countries such as Chile and Panama have procedures that require about two weeks. You can get a business started in Hong Kong or Singapore in three days.
It may be more productive to select the right market and jurisdiction than to spend years taking business courses. In many places, the capital investment is very low and your business will be off and running.