Across the sea: Expanding your business into Europe
With recent news that both B&M Bargains and Costco are looking to expand their warehouses in Europe, the recovering credit bubble is tempting investors to spread their wings from the UK.
Of course, the recent Eurozone crises seen in Greece and Spain may be something to put businessowners off, but international expansion is key to overall growth. With a truly integrated financial system and strong regulation by the European Union, Europe is the perfect place to formulate a global vision of quality, pricing, service and distribution. Here are some considerations when looking to buy and sell in the continent.
Know your market
Even though your products and services need to be globally competitive, they must also be tailored so that they can meet local markets and conditions. Research the target market of the location you are thinking of and see how your business plan can be customised around such a base.
To gain a full insight on your target market, make use of all the various governmental resources that are available such as the UKTI, British embassies, and European bodies including the European Entrepreneurs Networks.
Know your location
Your investment needs to remain cost-effective. Therefore, it will be wise, for example, to invest in a warehouse facility that is close to a port for shipping purposes. On a wider scale, look at market trends and how other similar businesses are performing in regions. Costco has already revealed that it is seeing slashed property values and healthy returns by other firms in Turkey, suggesting that the company is already prioritising some regions over others.
Know your finances
Once all the agreements are signed, you will be expected to make initial investments in industry space and aftercare. Of course, you can invest your existing assets, but be wary to budget carefully. Furthermore, check the tax position in the country you are wanting to buy in. There may be some gains tax that needs paying, or you may even be entitled to some tax relief if you make a loss on foreign exchange, so be sure to seek professional advice.
Foreign exchange fluctuations is a basic principle of life, so if you are not a foreign exchange dealer, talk to banks about overseas investment and rates.
Know where you come from
This is the most important factor of all. By making the most of the UK, and the warehouse and industrial units available at your disposal, you will ensure that your business will grow naturally while also remaining cost-effective.
Workers back in the UK need to consider increasing their operations beyond the normal working hours, if they want to tap into potential customers in a different time zone, with some parts of Europe being as far as three hours ahead, whilst bosses should make the most out of employees that know multiple languages. The latter ensures that the business can then offer services in more than one language.
By considering European legislation, but keeping an eagle eye on your business back in the UK, you can make sure that you expand globally, one nation at a time.