HR international expansion guide
Go global with speed and security
Expanding internationally presents both a tough challenge and a big opportunity for businesses aiming to enter overseas markets and hire top talent. Yet new rules, cultural differences and extra administration can create real costs and risks.
As a leading global HR platform with first-hand experience of scaling internationally, we provide all the tools to help you manage those hurdles. We also offer guidance to inform your choices and help you get the most from your resources as you move into new markets.
When we discuss global expansion, we speak from direct experience. We’ve grown and supported a team of more than 1,000 people across 70+ countries and partner with customers on every continent. We understand what it takes to expand overseas successfully.
What you'll learn in this guide
In this guide we draw on that know-how to offer practical advice and tactical takeaways. You’ll get proven recommendations not only for entering markets, but for scaling in a sustainable way that supports long-term success.
Specifically, we’ll:
Discuss how to nurture a strong global presence
Explore localised strategies that shield your business from cultural and regulatory pitfalls in new markets
Introduce the core principles of sustainable expansion
Showcase tools and processes that can streamline the entire effort
Table of contents
What is international expansion?
Effective expansion strategies
Building an international team
What is international expansion?
International expansion is when a company grows its operations from a domestic market into a foreign one, enabling your organisation to reach new customers and markets.
Hiring overseas talent is often central to expansion, because the right people provide a strong foundation and vital local market knowledge.
Expanding into overseas markets can seem intimidating for any business, especially small and medium enterprises. The process can be complex, slow and full of hidden risks. But with the right strategy and tools, the upside can be substantial. What does international expansion look like?
Historically, expansion meant setting up legal entities in each country you wanted to operate in. Today, companies are increasingly choosing alternative — and more cost-effective — ways to grow overseas.
Crucially, international expansion is no longer only for large, established firms. Globalisation and tech advances have made it far easier for smaller businesses to operate across borders.
“Despite an uncertain economic outlook, 72% of global businesses are planning ambitious expansions into new markets, supported by major investments in digital technologies.” Equinix Global Tech Trends Survey 2023
4 ways to expand internationally
No matter your company’s size, there are several routes to international expansion. These include:
Exporting
Exporting means selling goods or services to customers in other countries, either physically or online.
Exporting can take many forms, such as international ecommerce. With global payment providers and platforms like Amazon, Shopify and BigCommerce, you can sell worldwide without needing a physical presence in every market.
Licensing
Licensing is when you grant another company the right to use your intellectual property (IP) — for example trademarks, patents or copyrights — in return for royalties or fees. This lets you extend your brand and know-how into new markets without operating there directly.
This approach can work well if you own IP — such as software or technology — with multiple use cases, or if your brand already has strong recognition.
Acquisitions and mergers
Buying or combining with a foreign firm is another common approach, with cross-border mergers and acquisitions growing strongly in recent years.
This trend highlights the strategic value of acquiring or merging with established companies to gain access to new markets, technologies and customer bases.
Joint ventures and strategic alliances
Joint ventures and alliances are formal partnerships between companies in different countries aimed at sharing resources, expertise and market access. An alliance can let you enter new markets, share risk and leverage complementary strengths.
Unlike a merger, the aim is to build a mutually beneficial partnership, often between organisations in different sectors.
Direct investment
Direct investment means putting capital into a foreign company with the goal of gaining some control over its management or operations.
Some investors go further and establish a physical presence in the target country — typically by setting up a subsidiary or branch. That gives you greater control over local operations.
This approach is becoming more common, with many businesses increasing investment in emerging regions such as Africa, southeast Asia and Latin America.
“Emerging economies — which once represented no more than 15% of the global economy — now account for nearly 50% of economic activity.” Mauro F. Guillén, BBVA
What are some effective international expansion strategies?
Your global expansion strategy should act as a roadmap for scaling. Serving as a “true north,” it should set out the concrete steps your company will take to reach those expansion goals.
“In recent years, bold global expansion could have been seen as too risky or too dependent on capital investment in physical infrastructure. Now, things have changed.” Karl Strohmeyer, Chief Customer Officer at Equinix
International expansion approaches typically follow one of three paths:
International strategy
With this approach, your company sells products or services into foreign markets while keeping production in your home country. It lets you leverage existing production capabilities to serve overseas customers.
Exporting like this means you can meet international demand without building local production facilities, using a consolidated growth model that draws on your company’s strengths.
This route is often preferred by small businesses and startups.
Multinational strategy
A multinational strategy sees your company operating in several countries and adapting products or services to local market needs, recognising that markets have different preferences, cultures and regulations.
To serve these markets effectively, your company might:
Modify your products or services to meet local demand
Tailor your marketing and communications
Set up local production or distribution facilities
This path focuses on meeting distinct customer needs in each country while maintaining an international footprint.
Global strategy
A global strategy treats the company as a single unit offering standardised products or services across countries. The emphasis is on consistency rather than local adaptation, driving economies of scale and efficiency.
This approach simplifies operations, centralises decision-making and leverages global brand recognition.
It tends to suit larger, more established organisations.
Do you need to set up a legal entity to expand internationally?
Not always. It depends on your company’s objectives and resources.
For some businesses, establishing a legal entity is the correct route. If you have the budget, time and it matches your goals, it can be highly beneficial.
For most businesses — especially startups and small firms — opening entities in multiple countries is often impractical.
Beyond the resources required, forming a legal entity is a major commitment. If plans change, dissolving the entity can be complex and costly, risking wasted time and money.
Working with a global HR partner gives you greater flexibility and less commitment. For example, you can trial a market by engaging independent contractors first; this lets you hire quickly while making it simple to withdraw if needed. Remote’s Contractor Management platform lets you hire, onboard, and manage contractors in a straightforward and cost-efficient way.
If things go well and you decide to hire employees as you grow, you can use an employer of record (EOR) service — such as the one offered by Remote. An EOR lets you legally employ people abroad without the time, cost, and complexities involved in setting up an entity. This helps you scale international hiring across multiple markets quickly and compliantly. As you expand globally, you can also tap into Remote’s localised HR, tax, benefits and payroll expertise. That saves you the effort of sourcing local providers and helps ensure compliance with local employment and tax rules.
We’ll explain how this works in more detail below.
What is the best time for international expansion?
Timing matters when you enter a new market. But how do you tell if now is the right moment to expand?
Here are some signals that it may be time to look beyond your borders:
If your domestic market is saturated and growth opportunities are limited, expanding overseas could be a logical next step. Make sure your home business is stable and successful before you branch out.
A steady stream of orders or enquiries from a particular foreign market can signal a real opportunity to expand in that region.
If research shows strong demand for your offering, low competition or favourable economic and regulatory settings in a foreign market, this could be the right time to act.
Does your business have a unique product, service or technology that would give it an edge overseas? If so, it may be worth exploiting that advantage through expansion.
If you can easily adapt your products or services to fit a foreign market and there is clear demand, your chances of success abroad improve.
Hire anywhere with Remote's EOR
Whether you need one overseas hire or thousands, Remote has the infrastructure, experience and expertise to support you. Our market-leading employer of record services deliver a world-class experience for your global team — and dependable pricing, legal protection and peace of mind for your business.
There are many reasons why going global might be the right decision for your business, including:
Talent acquisition
One of the biggest benefits of international expansion is the chance to tap into new talent pools.
Employing people overseas gives your business access to new skills and perspectives and improves diversity and inclusion. A major McKinsey study found diverse teams are 33% more likely to outperform peers.
Hiring international talent can also be more cost-effective, particularly when roles are remote.
Remote can help you find top talent in foreign markets, and hire, onboard, and manage them quickly and easily.
Brand exposure
Expanding internationally raises your visibility and reputation in new markets, exposing you to a wider audience and building trust. That can boost brand recognition and, ultimately, revenue.
Happier employees
When you hire globally, staff often welcome the remote model and its benefits. In our Global Benefits Report, for example, 78% of remote workers reported greater satisfaction with their benefits versus 60% of on-site staff.
That engagement helps retention and makes your organisation more dynamic. In our 2023 Remote Workforce Report, 72% of companies reported increased productivity after shifting to a remote, distributed workforce.
Increased revenue
Global expansion opens access to new markets and customer segments, helping unlock additional revenue. It can also help you outperform peers: companies that expand internationally generate an extra 1.9% in annual shareholder returns compared with competitors that don’t expand.
McKinsey also finds that businesses already growing strongly at home gain even more from international expansion, achieving an additional 2.6% in annual returns.
Potential cost savings
Alongside higher revenue, international expansion can lower costs. Entering markets with cheaper resources, materials or wages may reduce your overall expenses.
Localised insight
When entering new markets you need local expertise. Without it you risk alienating or offending local customers and partners, through communication errors or deeper cultural mismatches. You might also be unaware of local business practices, wasting time and money.
Hiring people on the ground with cultural knowledge helps you avoid these mistakes. Whether you bring in consultants as contractors or appoint a local employee to lead operations, Remote can help you find and recruit the right person.
“Hiring international employees gives your company a soft landing when entering new markets and allows you to build trust quickly in new places.” Job van der Voort, CEO and co-founder of Remote
Competitive advantage
Entering a market ahead of competitors is an effective way to build brand recognition and credibility. Getting there first can give you a lasting advantage in your sector.
Even smaller companies can make significant impact if their product or service fits the market well.
Market protection
A global footprint lets you tap into varying market trends and customer tastes, diversifying revenue streams and reducing exposure to local downturns.
Operating in multiple markets can cushion your business from local recessions; losses in one country may be offset by stronger performance elsewhere.
That can help preserve overall business stability during tougher economic periods.
Customer support coverage
If you have many customers in a region or who speak a certain language, expanding lets you support them much more effectively.
You can recruit local customer support specialists with the right language skills and cultural knowledge, delivering a smoother experience. This model scales too, so you can have dedicated local CS teams in each country you serve.
Strategic partnerships and collaborations
Expanding globally gives you a platform to form strategic international partnerships that would otherwise be out of reach.
Those relationships can spur innovation and let you access new markets or boost operational efficiency through shared knowledge and tech transfer.
What are the challenges of international expansion?
International expansion brings many benefits, but it’s rarely straightforward. Even in the best conditions, success isn’t guaranteed, regardless of industry or company size.
The data shows this: companies expanding overseas often record a return on assets (ROA) of -1% for up to five years, and only 40% surpass a ROA of 3% or more.
That’s why it’s vital to recognise common pitfalls in global expansion and how to address them. Below are the main challenges you’re likely to face.
Local legislation and regulations
Failing to comply with local employment and tax laws can lead to fines, legal action and even bans on trading. Navigating foreign legal systems can be complex, slow and frustrating — especially where rules change frequently.
That’s why it’s wise to work with an experienced global HR partner. Remote helps ensure compliance with labour and tax laws where you hire, letting you focus on operations and growth.
“Remote provides all the local compliance and regulatory knowledge for each specific country in-house. Without them, we would have to hire an additional 3 or 4 people to be able to cover all the local labor laws, taxes, accounting, translation, and payroll responsibilities.” Mona Walther, Senior People Operations Manager at commercetools
Check out our Country Explorer tool to see all currently available countries and roadmaps.
Market differences
Many firms err by simply copying what worked at home. Going into foreign markets requires a deeper grasp of local dynamics, consumer preferences and cultural nuances.
For instance, several fintech firms are expanding globally and are product- and engineering-led.
However, they may lack experience in crafting cross-border go-to-market strategies or knowing which campaigns, channels and messages will work. That’s why it’s important to hire the right people who understand the market you’re entering.
Cultural differences
Cultural differences affect communication styles, negotiation and people management. A lack of cross-cultural awareness can lead to misunderstandings, strained relationships and even failure.
That’s why hiring local employees is beneficial: they know the culture and customs, can provide valuable insights and introduce networks that help you navigate the local business environment.
Competition in foreign markets
Foreign markets are often highly competitive, with local and international players competing for share. Knowing the competitive landscape and standing out is essential.
Global competition has surged in recent years, so a clear competitive strategy is vital when expanding internationally.
Time and money
International expansion can require substantial upfront investment, including:
Legal and regulatory compliance
Setting up local operations
Building distribution networks
You may also need to invest time and money in forming local partnerships and recruiting and training a local workforce.
These costs add up. For example, forming a legal entity can take up to 12 months and cost over $100,000 per location, depending on local requirements and ongoing administration.
To avoid this, consider partnering with an expansion provider like Remote. With our EOR services, you can hire in multiple countries without creating a single entity — often getting set up within days.
To learn more about how an EOR operates, check out our in-depth guide.
Logistical issues
Depending on your offering, logistics — such as transport, supply chain and customs — can be major barriers. Moving goods across borders requires careful planning to keep operations efficient.
You need an effective distribution network and resilient infrastructure to deliver your products and services to customers.
Banking and currencies
Expanding internationally usually means handling multiple currencies, banking systems and financial rules. You must manage foreign-exchange risk, set up banking relationships and understand international payment systems.
You’ll also need to decide how to pay employees and contractors in the new country. Remote can simplify this via our EOR, centralised payroll or contractor management services.
How to pay your global employees
Global Payroll How to pay international employees
Data regulations
Data rules are a complex part of international operations. They vary by country and affect how you handle and store data across borders.
It’s essential to stay informed about evolving data regulations to reduce compliance risks and protect your business.
Data security for distributed teams
Data Security & IP [Webinar Recording] IP protection and data security for distributed teams
IP protections
When entering new markets it’s important to safeguard your products, ideas and branding. Registering patents, trademarks and copyrights where relevant helps protect your IP.
You also need measures to stop IP theft or copying, aligned with local laws. If legal issues arise, you must know how to pursue them in local courts.
Remote can help you protect your IP when working with employees and contractors abroad.
Cybersecurity breaches
Data and cybersecurity breaches are widespread and can have severe consequences. IBM reports the average cost of a data breach in the US in 2022 was $9.5 million.
Protecting your business from cyber threats and data leaks is hard, especially when you’re operating in multiple countries. Different regions have different rules for data protection, and keeping up is challenging.
Transferring data across borders carries risk, and securing remote workers and their devices is complex. Home-based staff may use personal devices, increasing exposure.
You must train employees in safe online practices and use up-to-date tools and processes to keep your defences strong.
If you choose a global HR partner, check that its security meets your standards. Remote, for example, uses enterprise-grade data protection and security measures and has a dedicated security team to support customers. Learn more about Remote’s security protocols.
What are the key steps in international expansion?
Now that you understand the benefits and risks of international expansion, what does a practical expansion plan look like?
As noted, international expansion is more than planting a flag; it’s about understanding varied markets, building local relationships and navigating cultural and regulatory subtleties.
Below is an outline of the steps you might take — and how Remote can support you.
Start by thoroughly understanding the new territory. Analyse data, run assessments and build a clear picture of local consumer behaviour and preferences.
Study market trends and determine the growth potential for your company. Include macro-economic and demographic factors in your analysis.
Be alert to barriers such as cultural differences, language obstacles and regulatory limits. Knowing these in advance helps you decide whether to proceed and how to enter the market. Identifying your mode of entry Determine how you will enter the new market, taking into account your resources and risk appetite. Each mode — exporting, licensing, merging or direct investment — has its own pros and cons, so identify your risk/reward balance.
For example, exporting may be lower risk but gives you less control. Licensing can provide swift local access but may pose quality or reputation risks. Be sure to document your plan formally.
After research and choosing an entry route, build an expansion plan that acts as a roadmap and covers several key areas, including:
Financial plan : Estimate your budget for market entry and ongoing operational costs. Factor in currency exchange rates and financing options that could affect cash flow and capital structure.
Set realistic revenue and profit targets based on market research and model different scenarios — both optimistic and pessimistic.
Risk assessment: International business carries risks from political or economic instability to cultural and regulatory challenges. Conduct a thorough risk assessment to gauge the likelihood and impact of each risk and how it could affect operations, finances and reputation.
Once risks are identified, create strategies to mitigate or manage them. Contingency plans help your business stay operational or recover quickly from unexpected events. With robust risk management, your expansion strategy will be resilient and adaptable.
Infrastructure and logistics plan: Depending on your business, map out your infrastructure and logistics needs — both physical and digital.
This might include planning your supply chain, logistics and transport to ensure a smooth operation for all stakeholders.
This stage is about getting ready for market entry and may include:
Finalising and securing required funding
Preparing your digital and/or physical infrastructure
As noted, it’s critical to understand the legal and regulatory requirements in the new market to avoid fines and reputational damage. Know the employment laws, IP rules and tax and accounting obligations, plus entity setup requirements.
You can hire local lawyers and tax advisers, but that’s time-consuming and costly. It’s usually quicker and cheaper to work with an EOR like Remote, which handles legal complexities for you.
That lets you start hiring the people who will drive your expansion within days.
This phase is where you establish a viable presence in the market, whether by opening a local office or hiring local staff and ensuring you have the on-the-ground resources needed for effective operations.
You’ll also start rolling out your marketing strategy to build brand awareness and attract customers.
Once operational, focus shifts to scaling and growing your customer base. This stage involves ongoing marketing, acquisition and retention activities and is typically fast-paced with emphasis on performance metrics and ROI.
At maturity, your business has an established presence. The focus turns to refining operations and improving products or services based on customer feedback and market trends. This is a stable phase, but requires continuous effort to stay competitive.
HR considerations when expanding internationally
Building your team
Arguably the most important factor for expansion success is your people.
“We know that the success or failure of our company is 99% down to our people. So being able to attract and then retain the best talent is vital to our success."
-Antonio Arias, Chief People Officer of QuoIntelligence
Entering a new market is challenging. You must learn local workforce expectations and culture, including pay and benefits norms, as well as differences in labour law such as minimum wage, overtime and working hours.
With Remote you don’t need to worry. Our all-in-one platform supports every step of the employee lifecycle, letting you concentrate on the business. Here’s how we help.
Recruitment
The first task is finding the right candidates. Use local job boards, social networks and referrals, among other channels.
You can also use Remote Talent to help fill hard-to-fill roles, with our remote jobs board opening access to global talent.
With our EOR service you can also offer the best local benefits, making it easier to attract top candidates.
Hiring
After you make an offer, you can onboard hires quickly via our EOR service or, for contractors, through our Contractor Management service.
This approach is handy in new markets because it lets you “test the waters” with independent contractors before fully committing. You can also convert contractors to employees with us, avoiding accidental misclassification of workers.
“Companies increasingly see the value of engaging skilled freelancers on a project basis — getting the expertise needed without long-term commitment. Notably, this trend isn’t limited to Western markets; it’s also a growing source of work in developing countries.”
-Pedro Barros, Senior VP and GM for Contractors at Remote
Onboarding
Onboarding is one of the most sensitive stages in a new hire’s lifecycle. A poor experience can make the hire rethink their decision and alienate them.
When you hire via Remote’s EOR, new team members get a warm, personalised welcome and guided support through onboarding. We ensure the process is fast, simple and compliant, and assign each hire an HR manager.
The same applies to contractors: we ensure compliance and provide dedicated guidance and expert support.
"With Remote, onboarding contractors is seamless: it literally takes seconds to add new people to the platform, issue their contracts, and request the ID documents necessary for them to get started."
- Erik Sveen, Founder and CEO of HomeProject
Payment
Paying staff and contractors can be secure, simple and quick. Wherever your workforce is located, Remote streamlines payroll so you can run it in minutes.
If you use our EOR, payroll is built into the service: we handle calculations, deduct required taxes and pay your team on time. We also offer in-house support for payroll questions. Learn more about EOR payroll management.
If you decide to open your own legal entity in a new market, we can provide payroll as a standalone service. Learn more about Global Payroll.
You can also manage and pay contractor invoices with a few clicks — and in many currencies. Learn more about paying independent contractors.
Managing team members
Managing daily HR for international teams is simple with Remote. We offer a fully free HRIS that consolidates your HR stack and lets employees self-serve tasks like time and attendance, expenses and document management.
"The HRIS platform is easy to use and everything is there right in front of us. It all comes together and we’re not having to update different sources. That helps us be more efficient, which is so important in a scale-up."
-Bas Moeyaert, Loop Earplugs
Scaling
The best part about expanding with Remote is there are no limits to growth; our platform and services scale with you globally. As you hire and enter new countries, you won’t need to change providers or processes — unlike many local vendors.
Whether it’s recruiting, hiring, onboarding, paying or managing, we cover every aspect of global HR — from your first hire to your thousandth and beyond.
Examples of successful international expansion
Remote has supported organisations of all sizes to expand internationally, including:
Loom
Loom, a leading video communications platform, used Remote’s global infrastructure to grow its team in multiple countries.
With 900% year‑on‑year growth in 2021, Loom relied on a global talent pool to meet demand, but international hiring brought many complexities.
With 15 people across 11 countries, Loom’s HR team found it hard to keep up with local hiring rules. Creating international hubs and dedicated management wasn’t feasible.
Remote provided coverage where Loom had employees and entities, offering clear and fair costs through its EOR service. This allowed Loom to convert contractors into employees and improve the experience for their global talent.
As we continue to scale and go forward, we can now provide employees the opportunity to relocate through Remote and hire great candidates through Remote.
Loom has since unlocked a diverse talent pool while ensuring compliance with local laws, enabling growth and a better employee experience.
Primer
Primer, a fintech leader, used Remote’s infrastructure and know-how to manage the complexities of international hiring.
Recognising the value of remote work, Primer wanted access to a global talent pool, but expanding across countries presented many challenges.
Partnering with Remote gave Primer the tools to hire internationally, with Remote’s EOR offering a transparent cost model and ensuring compliance with local laws so Primer could focus on innovating in fintech.
I wasn't confident with the other EORs that we use, which is a dangerous game, because that puts more stress and pressure on our team to provide the follow-up. One of the biggest things Remote did was create this environment where you became an extension of our team, really followed up and overcommunicated in a lot of ways. That was vital for us, because it alleviated some of that responsibility from our team internally. -Erin Potter, Head of People & Operations at Primer
Primer was also able to convert contractors into full-time employees, creating a more consistent experience for staff. As a result, the company expanded its team across borders while maintaining employee satisfaction.
Read more about Primer’s story.
Seatti
Seatti, a technology company, teamed up with Remote to transform its global talent strategy and management.
Like many firms, Seatti wanted to support international growth by hiring in new markets, but global employment rules were a major hurdle.
With Remote, what caught our eye is the fact that you have your own legal entities in so many countries around the world. A lot of other similar providers that we looked at often just did it through partnerships. I think the growth and traction of Remote probably also speaks for itself and gives a strong indication that you're doing a lot of things right. -Chris Bieri, Co-founder of Seatti
Remote’s EOR ensured Seatti complied with local laws, enabling it to expand its team across borders and foster a culture of innovation and diversity.
Read more about Seatti’s story.
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Expand internationally with Remote
As you’ve seen, international expansion offers many rewards — but also numerous challenges.
Remote’s all-in-one global HR solution helps you manage these challenges at every stage. We enable you to consolidate and grow in new markets by hiring, managing and paying local talent while staying compliant with changing labour and tax laws.
Whether you need to hire one employee or contractor abroad, or hundreds across multiple countries, we provide everything in a single platform. And whenever you need help, our in-house, on-the-ground teams are ready to assist.
To learn more about our platform and how it can help you expand your business, book a demo or speak to one of our friendly experts today.