Is Now the Right Time to Take Your Company Global?

In light of recent economic events, many may shy away from global expansion. For some, though, it may be the perfect time to expand.

learn more about Par Chadha

By Par Chadha

Opinions expressed by Entrepreneur contributors are their own.

In the wake of the world's fight to recover from the economic downturn of the past few years, many businesses have put their plans for global expansion on the back burner. Inflation, a labor shortage, the Federal Reserve raising interest rates, and a struggling global supply chain are some of the biggest problems facing businesses at present. On the surface, it might make sense to hold off on expanding globally; However, now might actually be the best time to rethink global strategy.

Global expansion may resolve some of the problems plaguing the business world today. Government lending programs and untapped sourcing talent in emerging economies worldwide can help businesses fund expansion and increase the labor market talent pool. Global expansion can play a key role in creating goodwill for America and benefit the local economies where we expand.

Related: Considering Global Expansion? Now Might Be Your Best Opportunity.

Should you expand?

The decision to expand your business is one you must make with care. Expansion may not be for everyone. Before expanding globally, companies must evaluate their needs and capabilities for expansion and then choose how they wish to proceed.

There are two main types of expansion: opening a branch office and outsourcing products or services. It might make sense for a larger company to open a branch office in another country, as they tend to have more capital to invest in such large projects. Opening a branch office may not be feasible for smaller businesses, though. For many, outsourcing products or services is likely more beneficial and highly lucrative to save on operational costs.

A few considerations when looking to expand globally include:

  • Legal: Registering a business; Employment regulations; Taxes; Contracts; Intellectual property
  • Cultural: Language barriers; Marketing strategies
  • Economic & Political: Employment rate; Political stability (wars, riots, etc.); GDP and consumer purchasing power
  • Financial: Cost of building and labor; Insurance; Travel; Loans

Expanding into new areas opens opportunities to test new products in new markets, leverage local talent to grow a business, and invest in the local economy.

Related: How Fintech Companies Can Benefit From Global Expansion

Where to expand

There are many countries with growing or stable economies that would be great locations for companies considering global expansion. Countries with emerging economies, such as Vietnam, Columbia, Mexico, Rwanda and Nigeria, have untapped talent that can and should be utilized. Many of these countries already have ties with the United States, so they will likely welcome such investments with open arms.

Those in emerging economies have the same abilities and talent that we have in America but often lack the opportunities to put them to use. Many also possess relevant linguistic and technical skillsets that American companies need when expanding into foreign markets. With the help of the same software and technology we use at home, they can work from anywhere in the world.

Historically, a lack of infrastructure has been a barrier to expanding into new markets. But as infrastructure investments in countries with emerging economies continue, power generation, internet access, and telephone service are more widely available and accessible. These crucial pieces of infrastructure make it increasingly possible for businesses to begin to expand to those markets.

Related: How To Go Global With Your Business

Why now?

The business world has been uncertain, moving slowly due to concerns about a potential recession. That makes this the perfect time to expand. It's much harder to capture people's attention when everyone is busy, the economy is booming, and everyone has expansion plans in the works. The economy will always have its ups and downs. When it is up once more, do you want to be clamoring for talent and opportunities simultaneously as everyone else? Getting ahead now will make all the difference when business is booming again.

Companies considering expanding, but are apprehensive about doing so because of the current economic climate, can utilize government resources that are designed to help with business development. USAID and EUAID have funding programs that can help smaller businesses with global expansion projects if the business's goals align with the program. Both organizations focus much of their funding on Africa and Latin America, two regions that I believe are the next outsourcing hub.

I have spent years establishing connections and investing in countries worldwide, including Canada, Europe, the Philippines, China, India and Mexico. Throughout my time familiarizing myself with the best practices when expanding to new countries, I've found that the most crucial piece of advice is to visit the country you are looking to expand to.

Seeing the country with your own eyes, learning about its laws and economy, and meeting with citizens of the country who could one day be your colleagues not only helps you make a sound business decision but can help you gain new perspectives.

Even if you decide not to expand to that country, the worst that can happen is a good vacation!

Par Chadha

Entrepreneur Leadership Network Contributor

Founder, CEO, and CIO of HandsOn Global Management

Par Chadha is the founder, CEO and CIO of HGM Fund, a family office. He also serves as chairman of Exela Technologies and is the co-founder of Rule 14. He currently holds and manages investments in the evolving financial technology, health technology and communications industries.

Related Topics

Editor's Pick

This 61-Year-Old Grandma Who Made $35,000 in the Medical Field Now Earns 7 Figures in Retirement
A 'Quiet Promotion' Will Cost You a Lot — Use This Expert's 4-Step Strategy to Avoid It
3 Red Flags on Your LinkedIn Profile That Scare Clients Away
'Everyone Is Freaking Out.' What's Going On With Silicon Valley Bank? Federal Government Takes Control.

How to Detect a Liar in Seconds Using Nonverbal Communication

There are many ways to understand if someone is not honest with you. The following signs do not even require words and are all nonverbal queues.

Business News

What Does the Banking Crisis Mean for Startups and Small Business Owners?

Author, CPA and business owner Gene Marks break down everything entrepreneurs need to know about the impact of the SVB collapse.

Business News

'Invest In That Future Now Before It's Too Late': Bill Gates Calls For Global Pandemic Response Team In Op-Ed

In the same month that the World Health Organization called the coronavirus a pandemic three years ago, billionaire Bill Gates reiterated his call for a "fire department for pandemics."

Business News

New Mexico Is Hiring Professional Bear Huggers -- Here's How to Land the Dream Job

The American Black Bear was selected as the state's official animal on February 8, 1963, by the New Mexico Legislature.

Business News

Carnival Cruise Wants Passengers to Have Fun in the Sun — But Do This, and You'll Get Burned With a New $500 Fee

The cruise line's updated contract follows a spate of unruly guest behavior across the tourism industry.


Pros And Cons Of Leadership Coaching: Is It Right For You Or Your Company?

Leadership coaching can work really well in some cases and not so well in others. It all depends on a few factors and if your company is ready to make the leap.