Why Business Owners Try to Enter Foreign Markets : It is no longer news that business investors from all over the world wish to enter foreign markets to expand their local business operations or diversify their investments and establish new operations in international markets.
Every year, hundreds of entrepreneurs and growing companies regard international expansion as a marketing and growth strategy.
If you have been successful in your business for some time and you have mastered everything about running a business, expanding overseas may just be the next logical step you should take.
On the other hand, for most other people, simply having a company and business address registered overseas makes more sense to them than moving to this foreign country to set up a brick-and-mortar office.
Whatever the reason, there are at least 7 reasons why entrepreneurs set up companies, subsidiaries, or representative offices abroad.
About 95% of the world’s consumers are outside Nigeria. Entrepreneurs whose vision and target market are global will consider entering new markets overseas thereby increasing their market share and the overall growth potential of their company.
2. MARKET USABLE.
The untapped market possibilities in foreign jurisdictions can motivate Nigerian entrepreneurs to include foreign companies, subsidiaries or representative offices of their local companies. Nigerian entrepreneurs who produce and package local foodstuffs for sale abroad fall into this category.
3. CLOSE TO INTERNATIONAL CLIENTS/CUSTOMERS.
Honestly, the Internet is enough to bring businesses closer to buyers. However, for some reason, some business transactions may still require a traditional business presence in the city or country where it operates. The overseas office of a local company does not need to be that large, and may be a home business address, paid virtual office, or small/liaison office just for the sake of getting customer feedback and reconnecting to the Nigeria office.
4. COMPANY IMAGE.
To enhance their corporate image in the eyes of customers, suppliers, investors and businesses, some entrepreneurs simply register overseas subsidiaries of their Nigerian companies. This gives their target audience the impression that they are a company with an international network. In this situation, the “international entrepreneur” does not need to set up a brick-and-mortar office overseas, he just pays for a virtual registered office in that country plus mail and telephone services.
The fact that a competing business or brand enters a foreign market and is doing well motivates entrepreneurs in similar businesses to follow suit.
6. INTERNATIONAL PAYMENTS.
There are quite a number of international banking options available to companies registered in overseas jurisdictions – whether you are currently incorporated in an overseas country or operating an offshore company from Nigeria. Having a company checking account abroad makes international payments easier by direct deposit, check, or international wire transfer.
Entrepreneurs considering migrating or moving abroad can incorporate companies in the destination country pending their travel time.
The United Kingdom, for example, grants Entrepreneur Visas to persons outside the European Union to enter the UK for business reasons.
The initial visa will give you 3 years in the UK; and if during those 3 years you can show that you meet certain criteria, you can apply for a visa extension for another 2 years. After 5 years, you will have the option to apply for permanent residency in the UK.