Intelligent accountants know how to expand their businesses and their markets, which means they also know how to internationalize that is, how to operate their business in more than one country. This may seem like a big task at first, but it’s an excellent way to expand your reach and increase your profitability. Read on to learn more about this process and how accounting firms can make it work for them.
Why expand abroad?
The international market is booming—and accounting firms aren’t getting in on it. Deloitte, Ernst & Young, and PricewaterhouseCoopers together had revenue of more than $80 billion in 2012, according to The Economist—but they didn’t have a single employee outside of North America.
But with most regions still not tapped out, why are so many major players sticking to their own backyard? And how can small- and medium-sized companies get an edge by expanding overseas? Industry experts weigh in.
The key challenges
Despite all its benefits, as an industry we are yet to unlock some of our greatest opportunities. One of these is looking beyond borders. The challenge remains; how do you successfully expand your international business? How do you overcome cultural, language and political barriers? We’ve come up with a list of tips to help take your overseas ambitions from pipe dream to reality. This is how accounting firms can expand internationally.
What’s your strategy?
In order to expand internationally, accountants need a clear strategy. Your business plan is a great way to establish that strategy; it forces you to think through what your goals are and how you will achieve them. If your accounting firm plans on expanding globally, there are a few key decisions you’ll need to make: what countries will you focus on initially?
What’s your target client base? How much money do you need in order to make it happen? The answers will determine which markets are best for your business. Once you’ve pinpointed those, look at local laws, taxation issues and logistical concerns like staffing—and pay special attention to language differences.
Picking the right location
This one may seem obvious, but it’s important to pick a location that’s right for your firm. Accounting is a service industry, and people usually choose to use your services because they value your expertise. For example, if you’re an international tax accountant, then picking an area in which there are lots of multinational companies would make sense; if you specialize in helping small businesses with their taxes and finance, then a spot in which small businesses dominate might be better. This isn’t to say that other areas don’t have value, but by focusing on specific industries or populations of potential clients you’ll have greater success from day one.
Getting through the first few months
When starting a new business, you don’t have to do everything on your own. Learn how to create and maintain a great team so that you get through those difficult first few months. Then, once you’re off and running, consider outsourcing your non-core functions so that you can focus on what matters most—executing your plan and growing your business.
If you take these steps early in your company’s life cycle, you may find yourself more confident—and hopefully better equipped—to tackle challenges as they arise.
Setting yourself up for success
Before you even think about opening an office in another country, you need to make sure that your firm is ready for international expansion. This means training all of your staff members on global business practices and managing each step of that process carefully. By taking these necessary steps before you go, you’ll be more likely to set yourself up for success once you start going global. Read on to learn how to do it right!
Tax issues with international expansion
Whether you’re opening an office in a foreign country or doing business with those overseas, it’s essential to know and understand tax regulations. If you’re just looking to get a foothold in a new market, don’t assume your American status will automatically make operating there less complex.
On top of local taxes, you might be required to pay additional corporate income taxes back home if you do significant business outside of North America. And let’s not forget about other tax-related expenses like tariffs and duties that vary depending on what country your product is coming from and going to—and how much it weighs!
Conclusion
For any business, but especially for a small business or startup, maintaining records is an essential part of their everyday operation. Accounting firms must keep up with these records to properly service their clients and ensure that they are meeting all compliance standards. When accounting firms are expanding internationally, these requirements become even more vital.
That’s why it is so important to get an expert in international bookkeeping services on your team who understands how to work with foreign tax codes. There are many other aspects of expansion that need careful consideration as well—but thanks to our years of experience and dedication to helping businesses reach new heights, our experts have mastered them all and know exactly what you need when you’re growing into new markets around the world.
