HR international expansion guide

Go global with speed and security

Expanding internationally can be demanding but rewarding for organisations that want to reach new markets and access top talent. Still, unfamiliar regulations, cultural differences and extra administration can create real costs and risks.

As a leading global HR platform with hands-on experience of scaling abroad, we can supply all the practical tools you need to tackle those obstacles. We also support your decision-making and help you make the most of your resources when entering new territories.

When we discuss global expansion, we speak from direct experience. We have grown a team of over 1,000 people across more than 70 countries and advise customers around the world. We understand what it takes to expand successfully overseas.

What you'll learn in this guide

In this guide we distil that experience into practical advice and clear tactics. You’ll find proven recommendations not only for entering markets, but for growing sustainably and building long-term success.

Specifically, we’ll:

• Discuss how to nurture a strong global presence

• Explore localised approaches that shield your business from cultural and regulatory pitfalls

• Introduce the core principles of sustainable expansion

• Highlight the tools and processes that can simplify the whole journey

Table of contents

What is international expansion?

Effective expansion strategies

What are the benefits?

What are the challenges?

Building an international team

Successful examples

What is international expansion?

International expansion happens when a company extends its activities from its home market into one or more foreign markets, increasing its potential customer base.

Recruiting people abroad is often central to a global strategy, since the right hires provide local market knowledge and help establish a strong foundation.

The idea of moving into overseas markets can feel intimidating for many businesses — particularly SMEs. The process is often complicated, slow and full of surprises. Yet, with the correct strategy and tools, the potential rewards can be substantial.What does international expansion look like?

Historically, companies frequently needed to establish local legal entities in the countries they entered. Nowadays, however, many firms are considering alternative, more cost-efficient routes to global growth.

Crucially, international expansion is no longer limited to large incumbents. Advances in technology and global connectivity have made cross-border growth accessible to smaller businesses too.

“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 scale, there are several approaches to international expansion. These include:

Exporting

Exporting means selling goods or services to customers in other countries, whether by physical shipment or online channels.

Exporting can take many shapes, such as international ecommerce. With global payment providers and marketplaces like Amazon, Shopify and BigCommerce, you can reach customers worldwide without a local office.

Licensing

Licensing is when you grant another firm the right to use your intellectual property — such as trademarks, patents or copyrights — in return for royalties or fees. It enables you to extend your brand to new markets without operating there directly.

This route can work well if you own IP — perhaps a software or technology — that fits multiple markets, or if your brand already has recognition.

Acquisitions and mergers

Purchasing or combining with a foreign company is a common expansion method, and cross-border M&A activity has risen in recent years.

This trend highlights the strategic benefit of acquiring or merging with established firms to gain access to new clients, technologies and markets.

Joint ventures and strategic alliances

Joint ventures and alliances are formal partnerships between companies in different countries that aim to share resources, expertise and market access. Such partnerships can reduce risk and allow you to combine complementary strengths.

Unlike a merger, the aim is a cooperative, mutually beneficial relationship, often with partners from other sectors.

Direct investment

Direct investment involves putting capital into a foreign firm to gain a measure of control over its management or operations.

Some investors go further and establish a local presence, for example by opening a subsidiary or branch. That gives more influence over day-to-day operations in that market.

This approach is gaining traction, with many firms directing investment into developing 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 plan should act as a clear roadmap for scaling. As a guiding compass, it must set out the concrete actions your company will take to meet its 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

Expansion strategies typically follow one of three broad approaches:

International strategy

With this approach, your firm supplies foreign markets from its home-country production. It lets you use existing manufacturing or service capabilities to serve customers abroad.

Exporting from a central base means you can support international customers without building local production. It’s a consolidated way to grow that leverages your existing strengths.

This option is often chosen by small businesses and startups.

Multinational strategy

A multinational strategy means operating in several countries and adapting products or services to local market needs, recognising differing customer preferences, cultures and regulations.

To serve these markets better, your company may:

• Modify your products or services to meet local demand

• Tailor your marketing and communications

• Establish local production or distribution facilities

This strategy focuses on meeting the particular needs of customers in each country while keeping a global footprint.

Global strategy

A global strategy treats the company as a single unit offering a standardised product or service across countries. The emphasis is on uniformity rather than local adaptation, aiming for scale and efficiency.

This model simplifies operations, centralises decision-making and leverages a consistent global brand.

It is typically more suited to larger, well-established companies.

Do you need to set up a legal entity to expand internationally?

Not always. It depends on your objectives and available resources.

For some firms, forming a local entity is the best route. If you have the capital and time and it fits your strategy, it can be advantageous.

However, for many businesses — especially startups and small firms — establishing multiple legal entities is unrealistic.

Besides the resources required, creating a legal entity is a significant commitment. If plans change, dissolving that entity can be costly and legally complex.

Working with a global HR partner gives you more flexibility and less long-term commitment. For example, you can trial a market by engaging independent contractors first; this lets you hire quickly overseas and easily withdraw if needed. Remote’s Contractor Management platform lets you hire, onboard, and manage contractors simply and cost-effectively.

If the market proves successful and you decide to hire employees, you can use an employer of record (EOR) service — for example the one offered by Remote. An EOR lets you legally employ staff overseas without the time, cost, and complexities involved in opening an entity. This lets you scale hiring across markets quickly and compliantly. As you keep expanding, you can draw on Remote’s local HR, tax, benefits and payroll expertise. That saves you the trouble of finding local suppliers and helps ensure ongoing compliance with labour and tax rules.

We explain how this works in more detail below.

HR considerations when expanding internationally

Building your team

Arguably the single most important factor in whether your expansion succeeds is the team you build.

“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

When entering a new market you must understand local workforce expectations and culture, including pay and benefits norms and differences in labour law such as minimum wage, overtime and working hours.

With Remote you can leave those concerns to us. Our all-in-one platform supports every stage of the employee lifecycle so you can concentrate on the business. Here’s how it works:

Recruitment

The first task is to locate suitable candidates. Use local job boards, social networks and referrals, among other channels.

You can also use Remote Talent to fill hard-to-recruit roles via our remote jobs board.

With our EOR you can also offer the best local benefits to make it easier to attract top talent.

Hiring

Once you have the right candidate and have extended an offer, you can onboard them quickly via our EOR service or, for contractors, through our Contractor Management service.

This is useful when testing a market with independent contractors before fully committing. You can convert contractors to employees with us, helping you avoid accidentally misclassify your people.

“Companies are increasingly recognising the benefits of tapping into pools of skilled freelancers who can contribute on a project basis, providing the necessary expertise without long-term commitment. Interestingly, this isn’t confined to Western countries, but is becoming a popular source of work for developing nations, too.”

-Pedro Barros, Senior VP and GM for Contractors at Remote

Onboarding

Onboarding is one of the most sensitive sequences in a new hire’s lifecycle. A poor experience can make new hires question their decision and risk alienation.

When you hire through Remote’s EOR, the new hire receives a warm, tailored welcome and step-by-step onboarding support. We ensure the process is quick, simple and compliant, providing each hire with an HR manager.

This also applies to contractors; we provide the same compliant 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 employees and contractors can be secure, simple and fast. Wherever your people are based, Remote simplifies payroll so you can run it in minutes.

If you use our EOR, payroll is built into the service: we handle calculations, tax deductions and on-time payments, and provide in-house support for payroll queries. Learn more about EOR payroll management.

If you set up your own legal entity in a new market, we can also 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

Day-to-day HR for your international team is straightforward with Remote. We provide a fully free HRIS, so you can centralise your HR tools and let 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 advantage of expanding with Remote is there are no limits to growth; our platform and services scale with you globally. As you add people and enter more countries, there’s no need to swap providers or change your processes — unlike many smaller local suppliers.

From recruiting and hiring to onboarding, paying and 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 companies of many sizes to expand internationally, including:

Loom

Loom, a leading video communications platform, used Remote’s global infrastructure to grow its team in several countries.

After rapid growth of 900% year-on-year in 2021, Loom relied on a global talent pool to meet demand, but international hiring brought many complexities.

With 15 people spread across 11 countries, Loom’s HR team found it difficult to manage local hiring rules and creating international hubs wasn’t viable.

Remote provided coverage where Loom employed staff and entities, offering transparent costs via its EOR. This allowed Loom to convert contractors to employees and improve the experience for its workforce.

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 gained access to a diverse talent pool while ensuring compliance with local laws, helping the company grow and improving the employee experience.

Read more about Loom's story.

Primer

Primer, a fintech firm, used Remote’s infrastructure and expertise to handle the complexity of international hiring.

Recognising the benefits of remote work, Primer wanted a global talent pool but found cross-border hiring challenging.

Remote’s partnership gave Primer the tools to hire internationally with a transparent cost model via the EOR and ensured compliance with local rules 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, improving consistency and the experience for its workforce. As a result, the company expanded successfully while maintaining employee satisfaction.

Read more about Primer’s story.

Seatti

Seatti, a technology company, partnered with Remote to transform its approach to global talent acquisition and management.

Like many businesses, Seatti sought to grow by hiring in new markets but faced the complexities of global employment.

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 successful cross-border hiring and fostering innovation and diversity.

Read more about Seatti’s story.