How can a company grow and achieve corporate success as world economies change? Many companies think the answer is to determine how best they can get their products into these growing markets. While this seems straightforward, international trading laws, customs, and tariffs may drastically alter a company’s chances for success.
Local Market Preferences
Additionally, products should be suited to markets to ensure success. For example, clothing choices that are common in the United States would not necessarily find success in other markets. Another example is water filtration technology, where advanced markets seek to improve water taste and appearance, while emerging markets may seek to increase access to potable water or focus on basic filtration to ensure safe drinking water supplies.
Local tastes and preferences should always be considered to help ensure corporate success. Many successful businesses have struggled and failed to achieve success in their international growth initiatives. Much of this could have been prevented with stronger test marketing programs and in-depth local marketing research.
Alternate Routes to Success
Companies pursuing world economies as part of their corporate growth and success strategy might consider alternate routes to reach these markets. This may provide them with valuable market information to help increase their chances for success. Such information may include geographic area, general types of target customers and their demographics, information about local competitors, and information about government regulations, taxes, and requirements.
Which World Economies are the Fastest Growing?
Looking forward over ten years, the face of the world’s economic leaders will change. By 2030, the leading world economies will reflect the rise of Asia as a dominant economic force.
According to a Standard Chartered report, by 2030 Asian Gross Domestic Product (GDP) will account for approximately 35% of the global GDP. India is seen as the largest driver of this growth in Asia. This is due to the introduction of several reforms including the Indian Bankruptcy Code and a new National Goods and Services Tax (GST). Also, six of the largest world economies will be in Asia:
- China (Asia): $64.2 trillion
- India (Asia): $46.3 trillion
- United States (North America): $31 trillion
- Indonesia (Asia): $10.1 trillion
- Turkey (Europe/Asia): $9.1 trillion
- Brazil (South America): $8.6 trillion
- Egypt (Africa/Asia): $8.2 trillion
- Russia (Eastern Europe): $7.9 trillion
- Japan (Asia): $7.2 trillion
- Germany (Western Europe): $6.9 trillion
How can a Company Grow with World Economies?
There are several ways a company can grow with world economies. The traditional route of exporting goods into these markets has its limitations. As a result, examining alternatives is a valuable pursuit.
One way is to consider business expansion with a local operation. This may entail setting up a legal entity such as a Wholly Foreign Owned Enterprise, a foreign subsidiary, or a local distributor. A company might acquire a physical location through sale or lease. Staffing decisions may be made either through relocation, local direct hiring, or a combination of both. All of these activities may take a significant upfront investment in both time and funds.
Another way is to consider the services of an International Professional Employer Organization (PEO), an “Employer of Record” solution. International PEO is a global employment solution where a third-party in a foreign country hires your employees, acting on your behalf. The International PEO becomes an extension of your Human Resources Department. They manage all of the traditional HR functions including:
- Payroll and Tax Withholdings
- Remittances to Local Authorities
- Benefits
- Health and Social Security-Related Programs
- Onboarding
- Health Insurance
- Pensions
- Terminations and Separations
International PEO lets a company add full-time team members to their global operations within a matter of days. Companies can easily test new markets for their products without making significant investments in time or funds.
What Does This Mean?
The growth of world economies means that companies may have greater opportunities to find new markets for their goods and services. This also means that companies should examine market data from emerging economies. This information will help them determine if their products and services should be tailored to meet local demand. Companies may consider investing in local market research, conduct test marketing trials, and examine alternate routes to conducting business in world economies.
What Should Employers Interested in World Economies do?
Companies that are looking to leverage the growth of world economies should work with a Relocation Management Company (RMC) that has knowledge and experience in helping companies expand into new markets. Choose an RMC that provides ongoing employee support services, supplier management, relocation benefits, and expense management.
The RMC should also provide access to helpful solutions such as International PEO for companies looking to enter new markets to ensure:
- Full compliance with local requirements on international employment.
- The company expends the lowest monetary cost to save funds for use on other corporate objectives.
- They spend the least amount of time so the company can identify and pursue valuable opportunities.
Conclusion
GMS’ team of global relocation experts has helped thousands of our clients understand how to grow their company’s international employment to leverage the growth of world economies. Our team can also help your company understand how to work with an International PEO. As a result, this will help your company gain all of the benefits this solution provides for international employment.
GMS was the first relocation company to register as a .com. The company also created the first online interactive tools and calculators, and revolutionized the entire relocation industry. GMS continues to set the industry pace as the pioneer in innovation and technology solutions with its proprietary MyRelocation® technology platform.
Global Mobility Solutions is proud to be named and ranked #1 Overall, and #1 in Quality of Service by HRO Today’s 2019 Baker’s Dozen Customer Satisfaction Survey.
Contact our experts online to discuss your company’s international employment needs, or give us a call at 800.617.1904 or 480.922.0700 today.
