In the global world in which we live, there is great logic in copying business activity to foreign countries. Working in the global market allows selecting the most ideal country for the company’s activity, while minimizing both fixed and changing costs.
Despite the many advantages, business relocation is quite a complex and expensive matter, one that must be evaluated accordingly.
If you are considering relocating your business to a foreign country – below are all the important information you need to know in order for the company and its management to make the best decisions.
Adecco Israel is a global management company offering business solutions to many companies from 66 countries around the world.
Among Adecco services you can receive a wide consult on your company’s projects or business activity, such as: international employment solutions, recruitment and placement services, as well as financial management, a chief financial officer consult (CFO), payroll services, market surveys, human resources management (HRM) and many more.
Before making the transition, one must consult with an expert specializing in regulations of the designated country, including labor laws, company laws, tax laws, financial security and more.
The laws and regulations that apply to the company vary depending on the country you want to relocate to. Failing to meet local regulation demands may result in severe criminal sanctions.
In addition, tax consideration is usually the top priority in choosing the destination country. This is due to the tax burden effects on the company’s profit margin, and therefore it is important to consult about this topic with a tax advisor.
Adecco Israel is familiar with all global laws and regulations and provides an accurate response regarding these matters.
Word of Advice: Every so often there is a gap between expectations and reality.
In order to analyze whether the chosen country is the ultimate destination to grow your business within minimal regulatory constraints, it is worthwhile to examine the country’s regulations in advance.
Ignoring these regulations and focusing on business considerations such as marketing and distribution will most likely lead to a waste of valuable time.
It is important to address the language influence in the day to day management of the company. If you aren’t able to simply communicate in the spoken language of the target country, it may slow down your company’s pace of work and lead to potential damage to your company’s international success.
Word of Advice: After choosing your destination country, make sure to learn the local language – Your local colleagues will appreciate your efforts, you will be able to easily understand the local economy, comprehend the various matters within your company, deal with different jurisdictions in the country, and so on.
Likewise, learning another language is a great addition to your resume so that’s a win-win situation.
Other than the language gaps, there are also culture differences which can outsmart significant difficulties in adapting the company and its executives in the target country.
It takes quite some time to understand the cultural nuances in each country. For example, hand gestures or facial expressions, which would be considered as perfectly natural and normal in the west, might offend the eastern population.
It is recommended to hire someone who specializes in the local culture, who can mediate to the company and its directors the conventional way of behavior in the country and by that also be able to prevent any critical mistakes. Due to its extensive experience and familiarity with the various cultures of the world, Adecco Israel provides a complete response to understanding these cultural nuances in every destination in the world.
Word of Advice: Make sure to visit the destination country several times before relocating your company definitively. Research can be conducted, and you can get a full-time consult – but experience is definitely the best teacher.
As tourists you will have the opportunity to get to know the local people without harming the company’s reputation.
It is important to conduct general research on both the international market and the specific local market of your destination country.
While the company’s marketing strategy in Israel may be prosperous, doesn’t mean it will be the same in a foreign country as well. Business slogans suited to the target language and local culture must be generated.
Remember – you can’t translate the already existing slogans and expect your advertising to work! Most successful branding slogans include a hidden cultural significance – which is a crucial aspect of marketing that usually cannot be translated.
Word of Advice: Seek professional consultation!
It is not recommended to try and market a product on your own. Trying to save on expenses in the short term may lead to very heavy charges in the long run.
Keep in mind that every marketing action you make will determine the branding of the product in the country. An incorrect marketing strategy may result in a mistake that can’t always be fixed.
While hiring services of marketing professionals specializing in the local market raises the establishing costs, millions of dollars could be saved in harming the brand as a result of mistaken marketing strategies.
Adecco Israel has a global deployment and provides its clients with accurate solution according to their business needs, in a way that is tailored-made for them.
Adecco Israel is familiar with all relevant marketing methods in each country, and if necessary, could provide a customized service.
In the long run, it may seem right financially relocating your business to a foreign country, businesswise. However, in the short term, this may potentially be a very expensive move.
There is no justification for transferring business activity to a foreign country if the costs of the transfer lead to bankruptcy.
The transition costs in the country must be taken into account – in the annual and in the multi-year budgets of the company, in order to make sure that the company doesn’t harm its ability of liquidity, for example in case of requiring exceptional expenses during the transition period.
In addition, conversion costs of exchange rates must be considered. Conversion funds at an unplanned period may result in unnecessary expenses.
Among Adecco Israel’s wide range of services, you can consult and get a broad solution for the financial management of the business in the destination country, wherever it you want it to be.
Adecco has extensive experience and connections with countries all over the world, and provides businesses comprehensive knowledge of all matters in finance, regulation, law and many more – and that is valid for every country in the world in which you would like to expand your company’s activity to.
Word of Advice: Make sure to always stay up to date with current economic news and events, both in Israel and in the designated country.
Though you will need a financial professional, you still won’t be able to act effectively on your own without basic understanding, even while accompanied by an expert.
If you are operating a business that uses factories and expensive equipment, you may consider the profitability of selling and re-buying the equipment instead of transferring the existing equipment to the target country.
For some business sectors, such as biotech or agriculture fields – purchasing new equipment include high costs, so it is important to consider other alternatives.
Hiring the services of a company that is capable of optimizing and minimizing transfer costs can lead to substantial savings.
Word of Advice: Request three price quotes for each option – transferring the assets or selling and purchasing new equipment. This way you can make sure to make the ideal decision for you.
Similar to the previous section, you need to consider how legal entities are handled. Services can be provided abroad without establishing legal entities in the target country, if you join forces with a global company as Adecco. It is recommended to postpone the establishment of a legal entity up to two years after operating the business overseas, in order to examine the business profitability in the destination country.
Furthermore, it is to be decided whether to continue operating the existing legal entity in Israel, or whether it should be dismantled or sold. It is also important to seek advice from a suitable professional in order to make the right and most informed decision.
Adecco Israel provides its services to companies without a legal entity in the target country and gives a specific response to their needs, while starting activities in the targeted country.
When transferring your business activity abroad, it is crucial to pay special and close attention to the main issues involving the relocation.
The decision to transfer a company abroad, which will hopefully lead to great business success, entails many challenges.
Lacking proper and professional assistance in all different aspects may harm the chances of the business succeeding and thriving overseas.
Adecco Israel – a business solution management company, operates branches in 66 countries worldwide. Among its’ broad business activities, Adecco provides a complete service which enables companies and Israeli businesses to transfer their operations to countries all over the world.
With the global actions of Adecco Israel – it is possible to optimize the transfer of business activities abroad, and therefore can save resources, time and maximizing the business’ profits.
We are waiting to hear about your project and see how we can help you thrive and bring your company to success!
Contact us and we will be happy to assist you.