09 Jun 2022
According to a survey of The Business Time, 87% of Singapore firms surveyed are planning to take their operations internationally in the next 3-5 years. Global business expansion is crucial for long-term growth. Definitely, crossing new borders means conquering new challenges for any business. In this article, we will explore some challenges of global business expansion.
Regulatory Compliance
When expanding business globally, it is a must for businesses to gain a comprehensive understanding of various legislation and laws. For instance, tax implications, potential tariffs, accounting & trading laws, employment & labor requirements, and even unwritten cultural customs and etiquette. This practice can be especially challenging in emerging markets but will be the first and foremost condition for a successful international business.
Currency Rates
Currency rate fluctuation is one of the major considerations as it seriously impacts the balance of business profit. This may be extremely detrimental to sustainable growth. Enterprises, therefore, should have a strategy for monitoring exchange rates and forecasting profit, particularly when rates fluctuate at unpredictable levels.
Talent Acquisition & Manpower Management
In the process of global business expansion, scouting talent and retaining a sense of company culture can be much more challenging. Additionally, it is also hard for managers to build and maintain a strong working relationship with the global team. The advice for businesses is to find good sources to recruit experienced specialists with strong skills and have an in-house HR department. Government or HR professional institutions can also be a good consideration for human resource acquisition.
Supply Chain Risks
Managing a cross-national supply chain can be a real obstacle. It includes imports, exports, delivery, and logistics. Moreover, due to the complexity of supply chains, there are also many unethical and illegal situations (labor exploitation, counterfeit documents, corruption, etc.). Hence, businesses have to grow concerns and investigate thoroughly before engaging in a global supply chain.
Conclusion
Business challenges are no exception to any enterprise anywhere. Global business expansion can be challenging but rewarding for companies to accelerate their growth. A plan for actions, strategies, resources, and the above 4 vital considerations can help mitigate many arising issues. Considering the adoption of advanced technologies such as Enterprise Resource Planning system (ERP system) can also be a great solution to successfully grow operations abroad.
With more than 32 years of experience, Synergix Technologies has offered ERP solutions in Singapore. We have helped hundreds of SMEs handle business challenges effectively. As we are a pre-approved vendor by the IMDA, eligible enterprises can receive the funding up to 70% of the qualifying cost when adopting Synergix ERP Software. Feel free to contact us for a free consultation!
