There’s a whole big world out there, with new pools of customers, partners and talent for those companies looking to expand globally.
Opportunity abounds for multinational companies (MNCs), especially in fast-growing economies. While emerging markets accounted for less than half (49%) of global GDP as of data from 2022, according to projections from World Economics, this group will account for 55.2% of global GDP by 2030.
The bad news is that, once reality sets in, expanding a business across borders can seem like a daunting task. There’s no one-size-fits-all model for developing a global strategy and the challenges, risks and opportunities vary depending on company size, industry, objectives, target countries and more.
In this blog post, we’ll explore some essential starter considerations businesses should account for when developing a global expansion and hiring strategy.
What should a global strategy include?
A global business expansion and hiring strategy may cover the following:
- Set your company’s specific goals and objectives for expanding globally.
- Develop a list of target countries.
- Identify how you will go about localizing product development and marketing.
- Mark a path for connecting with international partners and vendors.
- Conduct a risk assessment for conducting cross-border business and hiring.
- Account for labor laws and other HR processes, such as payroll processing, contributions, taxation, benefits and general employee support.
Are you asking the right questions?
A company should consider the following questions prior to committing to a global expansion and hiring strategy:
- Do the economic and operational benefits of expanding into an international market outweigh the risks?
- Does your company have the staff or executive team to effectively expand?
- How familiar is your HR team with the labor landscape of the target market?
- Will they be able to administer payroll?
- Will you be able to adapt to the local culture? This includes not just adapting your product and services but also your operations, including the worker experience.
- Will your HR staff be able to communicate with workers in their native language in order to execute payroll?
- What role will time zone differences play in operations?
- What is the optimal mode of entry into the international market?
Where will you go next?
Sometimes, a company may believe it is in the position to undergo global expansion or engage in cross-border hiring. However, it may not know what country or countries to focus on.
Generally, landing on a target country is a multistep process:
- Create an initial target list with reasons for why each country is on the list.
- Determine country attractiveness (including pros and cons).
- Calculate the market opportunity in each country.
- Outline the business landscape, understanding what it will take to compliantly report and internally to manage a headcount (administer payroll, benefits and taxation).
- Determine what options may be available to assist your entry into each market.
Who can you turn to?
Once you have identified where you would like to expand to or hire in, it is important to consider what expert partners you should have on your team.
The following professionals and functions should be carefully vetted:
- HR/Benefits (this may include an Employer of Record)
Is EOR hiring the right solution for you?
Even the most well-executed global strategy is not without its challenges. For example, hiring internationally and managing global payroll can be complicated and time consuming, with statutory requirements and payroll processing varying drastically from one country to the next.
An Employer of Record (EOR) service is often the right solution for efficiently achieving business goals – while also saving time, money and hassles in international hiring.
An effective EOR provides the administrative acumen and due diligence to ensure international employees are welcomed locally, onboarded efficiently and well-cared for throughout the entire employment tenure.
Key back-office tasks handled by an EOR partner
Payroll Tax withholdings Statutory and supplemental benefits Visa and immigration support Onboarding tasks, including background checks and drug testing Compliance with labor laws (such as bonuses, leave and termination protocols)
Developing your global strategy does not have to be a daunting task. By partnering with an EOR, your company will be able to streamline your expansion and hire the best talent for the job – no matter where they are in the world!