The entrepreneurial spirit can strike no matter what country you live in. Many Americans living overseas will look to open a business while they are living there. Starting a business does carry some risks and those risks are higher when you are not in your home country. However, being abroad may bring some benefits that are not available otherwise and present a good opportunity for success.
The risks are higher because there are added layers of complexity that have to be accounted for. Yet, there could also be benefits like tax breaks or other incentives for people to start a business. The reasons for starting the business are not so important. What is important is that you understand what you are getting into. In this article, we will give you several steps that are involved so you can start a business abroad.
1 – Understand the requirements
Other countries generally have a lot of bureaucracy when compared to the United States. It is very important to understand what the requirements are for getting started. You should start out by checking in with the local Chamber of Commerce or the city hall where you plan to establish the business.
You may need to make sure that you understand the taxation rules to be able to budget accordingly. There are generally going to be a certain amount of taxes paid based on the number of employees in some countries and it can be quite expensive.
There are a number of likely regulatory issues that will also need to be sorted out. For instance, if your business relies on importing certain materials then this is going to have a direct bearing on your ability to make a profit since some will be outright banned while others require paying a tariff.
All of the various regulations will all still come in under the umbrella of also needing to make sure that your immigration status is correct so you are able to proceed with any business plans.
2 – Hire a fixer
If you are a foreigner that doesn’t understand the language or the culture fully then you will likely need to have a middleman. This is a fixer who is hired to deal with various offices, agencies, and individuals to make sure that things are able to run smoothly.
Very often locals will be able to navigate a complex bureaucratic system with ease. It doesn’t matter if you do actually speak the language either, in many countries. Since you are still a foreigner there will be additional hurdles that a local won’t have to jump over.
The fixer may be an attorney, an accountant, or a consultant that you can find that will be professional as well as effective. Whoever you end up going with, it’s important that they have some experience in the sector of your business, or that they have an understanding of the local laws and regulations.
3 – Understand the business culture
There are a lot of differences between how business works in the US and how it goes in other countries. There is a different pace and often there are cultural differences which influence the way business works. It is essential to understand how culture dictates how business should be done.
In many cases, you should expect a slower pace when it comes to making things happen. Other countries are not usually in a rush to get things done so it pays to be patient.
One area where a cultural difference is the most glaring is with regards to negotiations. There are a lot of cultural norms that are involved and going against them will sabotage your best efforts. Expect negotiations to be very unfamiliar. You’ll need to learn what they are to have any hope of a positive outcome when it comes to negotiating terms or prices.
4 – Build a network
Establishing local relations is crucial if you want your business to succeed. Most business success is based upon relationships no matter what country you’re in. when you are a foreigner somewhere then it takes on added importance.
Look to join some local associations that are friendly to your business. For instance, Rotary is a club that is popular internationally and will put you in contact with many local business leaders that will be important to know.
Look to get to know people in the local government as well. Having a good relationship with the people responsible for issuing certificates and licenses for your business will help make things go more smoothly when the time comes.
Once you have cleared many of the initial hurdles, then your business should run just as it would anywhere else. With the right attitude it will be successful no matter that you started in a foreign country.