Market entry tips

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• People in each national market work against different legal, regulatory and cultural backgrounds. It is important to understand the differences as strategy is formulated for market entry. BABPN can help at this stage. As you progress to establish your new operation our help will be available to you from your chosen providers of legal, accountancy, marketing services - indeed whatever services you require and if they are not featured for any reason we can source them to suit your needs.

• Setting up a branch office is cheaper and quicker than establishing a subsidiary company, but may offer less credibility with customers. It is important to understand all of the legal and business issues, including whether you must have local ownership or local residence of shareholders and members of your board of directors and whether your distributors will be considered as employees.

• Most countries have facilities to register different types of company involving different amounts of capital to set up and different reporting requirements. Your choice may be crucial in determining current cost levels and future expansion capabilities. Your legal and accountancy advisers (see below) will advise you in this area.

• Expertise in local legislation is essential for all companies. If your company is involved in areas subject to specific legislation (food, pharmaceuticals, copyright) it may be necessary to engage a general law firm with access to counsel in your specific area of operation. Your adviser will also understand national employment legislation and be able to offer support in preparation of employment contracts, Terms and Conditions of sale, etc.

• It is always advisable to register company trademarks, product and service trademarks at an early stage to avoid difficulties with distributors or third parties who may already have registered important trademarks.

• It is advisable to understand local regulatory standards for manufacturing in your product area. In some cases you may be required to manufacture your product within the new market, adhering to regulations relating to specific type products may have their own within the country.

• A partner or partners will be required who understands local legislation, and ideally your national legislation. They should be able to provide a range of services including preparation of monthly accounts, payroll management and annual audit. In addition they will be your source of advice on tax issues, including Corporation tax, Value Added Tax or other local Sales tax and Capital tax.

• You will require local banking. Your accountancy service provider will be able to offer advice in this area. To ensure you do not have problems with movement of monies in and out of countries you should understand any restrictions on currency movement across borders and whether profits can be repatriated to the home country or must be reinvested in the foreign country.

• Many aspects of your new operation will require provision of credit by local suppliers. This is often difficult to obtain in the first years of operation. It may be necessary to set up a line of credit or a Parent Company guarantee with the local bank to ensure the new operation is bale to operate effectively. The local bank will advise in this area.

• Your legal and accountancy advisers will help you to understand customs and tariff issues with respect to your product into the foreign country. Taxation authorities of the local country will pay particular attention to transfer pricing as it affects both customs and tax issues.

• Local recruitment companies understand their market and work at local rates. International recruitment companies are often more expensive and so they can and should be avoided.

• Even within the EU local employment laws vary. Your local legal adviser should be equipped to advise you in this area.

• In all countries employment law requires compliance with a large volume of legislation. Your legal and accountancy advisers will offer services covering employment legislation, payroll and compliance with income tax and National Insurance rules. You may however choose to outsource this area of your local operation to a specialist company which will provide a comprehensive service and ensure you are in compliance with all areas of legislation.

• All literature that is passed out to the public or your distributors must be updated. Brochures should be appropriately written for the local market. Distributor agreements, policies and procedures, Terms and Conditions, termination notices, etc must comply with local law and practice. Your legal advisers and distributors can help in this area. Or you may choose to work with a company providing marketing services, which specialises in these areas. Such companies can work with you to formulate your Marketing and Sales plan for the new market.

• You may wish to engage a local PR company, which understands your sector. They will have contacts with the trade press in your sector as well as national press and broadcasters. This may be particularly advisable if you are planning a formal launch of the new local operation.

• Any or all of the above areas can be outsourced to service partners. Business Across Borders will be pleased to offer advice on how to achieve the best mix of operational efficiency and cost control for your new operation.