5 Point Checklist for investors contemplating an international business setup Every businessman worth his intellect harbours a dream of growing someday into an operation that transcends borders and becomes a multibillion dollar revenue machine. But there are a lot many obstacles that one may face with an international business setup than when the business took its first baby steps. At least, that has been the case and still is, in most parts of the world. Having secured the necessary rounds of funding required for that potent business plan, it is time take a call on the single most significant factor can mean the difference between success and underperformance – Location. That’s correct, location. When setting up business operations, especially one that is to be tailored to be competent enough to battle it out on the international scale, some careful planning needs to be put into place. In recent years, there are a lot many governments and regions that are vying for a piece of the international investments pie. But it is only a select few that make the grade. Investors looking to explore and pursue new business opportunities on the international scale do need to ask themselves, as to which among their shortlisted options best meets their requirements. Every potential investment destination must match up on the following five points of evaluation, if it is to be considered worthy enough:
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First up is the check on the trade policies. This is because; it is a common practice for authorities to insist upon pairing up with a local partner for trade activities. For international investors, this may lead to unnecessary difficulties with respect to the partnership. Therefore, choose a destination that offers the freedom of full foreign ownership, even if it is limited to businesses in specially demarcated free zones
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Some destinations appear to encourage international investors to set up shop in their region, and then insist upon holding back a certain amount of the investment, citing local development compulsions. Truly progressive ones on the other hand, allow for full transfer of capital and revenues back to the investor’s country
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A big bugbear among investors who start new businesses is that the labour laws can be quite conservative. This flies smack in the face of business logic as one of the key factors to succeed internationally is through costefficiencies. Business destinations that offer flexibility in the recruitment and retention of skilled talent tend to stand a higher chance of attracting international investors
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High taxes can limit the profitability of even the most successful businesses. It therefore makes great economic sense to select a destination that levies the bare minimum of taxes, whether they may be in the form of income tax, personal taxes or business & professional taxes. Best if there are no taxes, in any form, being levied in the first place
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Quota systems and trade barriers are a restrictive practice that’s reminiscent of all that was negative during the earlier business environment. The world has moved on since then and it has become a global village in the truest sense. Thus, it helps if the investment destination being chosen is progressive enough to do away with such provisions that can prove to be a dampener on the trading spirit
The selection criteria discussed above offer investors the strongest chance of critically evaluating a business destination for their next international venture. For the option that they choose may very well make the difference between making a mark on the global business charts and remaining a fringe player on the local scene.