HR international expansion guide
Go global with speed and security
Expanding internationally presents demanding yet rewarding possibilities for businesses aiming to access global markets and hire leading talent. At the same time, unfamiliar regulations, cultural variation, and administrative demands can introduce substantial costs and risks.
As a prominent global HR platform with our own track record of international growth, we provide all the resources required to navigate these hurdles. We also support your decision-making and help you use resources efficiently as you enter new territories.
When we refer to global expansion, we speak from practical experience. We have hired and scaled a workforce of more than 1,000 employees across 70+ countries and partner with customers on every continent. We understand what it takes to expand successfully overseas.
What you'll learn in this guide
In this guide, we draw on that experience and expertise to offer you practical recommendations and tactical insights. We provide proven direction not only on entering new markets, but on scaling sustainably and achieving 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 fundamental principles of sustainable expansion
Identify the tools and processes that can simplify the entire journey
Table of contents
What is international expansion?
Effective expansion strategies
Building an international team
What is international expansion?
International expansion occurs when a company extends its operations from the domestic market into foreign markets. By doing so, the organisation broadens its market reach.
Hiring international talent is often central to a global expansion plan, since the right recruits provide a firm foundation and offer indispensable local market knowledge.
The prospect of entering foreign markets can be intimidating for any firm — particularly small and medium enterprises. The process may be complex, slow, and exposed to unexpected risks. Yet, with a suitable strategy and the right tools, the potential rewards can be substantial.What does international expansion look like?
Historically, expanding internationally often required firms to establish legal entities in target countries. Today, businesses are increasingly considering alternative and more cost-effective routes for global growth.
Crucially, international expansion is no longer the preserve of only large, established corporations. Globalisation and technological advances now make it feasible for small businesses to cross 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
Irrespective of your company’s scale, there are several routes to expand internationally. These include:
Exporting
Exporting means selling goods or services to customers in other countries, either physically or online.
Exporting can take many forms, including international ecommerce. With the advent of global payment providers and storefront platforms like Amazon, Shopify, and BigCommerce, you can sell to customers worldwide without maintaining a physical presence in those countries.
Licensing
Licensing is when your company grants another organisation the right to use your intellectual property (IP) — such as trademarks, patents, or copyrights — in return for royalties or fees. This lets you extend your brand and expertise into new markets without operating there directly.
This approach can be effective if you own IP — for example, software or technology with multiple applications — or if your brand enjoys strong recognition.
Acquisitions and mergers
Acquiring or merging with a foreign business is another common expansion tactic, and cross-border mergers and acquisitions have grown strongly in recent years.
This trend highlights the strategic advantages of acquiring or joining with established companies to access new markets, technologies, and customer bases.
Joint ventures and strategic alliances
Joint ventures and alliances are formal partnerships between firms in different countries that aim to access new resources, expertise, and markets. Such collaborations enable entry into new territories, risk-sharing, and leveraging complementary strengths.
Unlike a merger, the purpose is to form a mutually advantageous partnership, often with organisations from different verticals.
Direct investment
Direct investment involves placing capital into a foreign company with the intention of obtaining some level of control over its management or operations.
Some investors increase their involvement by establishing a physical presence in the target country (for example, by creating a subsidiary or branch). This grants greater influence over operations in the foreign market.
This approach is gaining popularity, with growing investment in underdeveloped 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 clear roadmap for scaling. Serving as a company’s “true north,” it must specify concrete steps to realise your expansion objectives.
“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 strategies typically follow one of three approaches:
International strategy
Under this strategy, your company exports products or services to overseas markets while continuing to produce them in the home country. This lets you leverage existing production capabilities to serve customers abroad.
Exporting enables you to meet international customer needs without establishing local production facilities. It supports a consolidated growth approach that builds on your company’s existing strengths and know-how while broadening market reach.
This route is commonly chosen by small businesses and startups.
Multinational strategy
With a multinational strategy, your organisation operates in several countries and adapts products or services to local market conditions, acknowledging that markets have distinct preferences, cultural norms, 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 prioritises satisfying the particular needs and tastes of customers in different countries while keeping a global footprint.
Global strategy
Under a global strategy, your company functions as a single entity offering a standardised product or service across multiple countries. The emphasis is on standardisation rather than localisation. The company preserves a consistent brand and product across markets, focusing on economies of scale and efficiency.
This strategy simplifies operations, enables centralised decision-making, and capitalises on global brand recognition.
It is generally preferred by larger, well-established organisations.
Do you need to set up a legal entity to expand internationally?
Not always. This depends on your company’s objectives and available resources.
For some organisations, forming a local legal entity is the appropriate route. If you have sufficient capital, time, and it aligns with strategic aims, this approach can be most advantageous.
For most organisations — particularly startups and small firms — establishing legal entities across multiple countries is rarely practical.
Beyond the resources required, creating a legal entity is a significant commitment. If circumstances change or you must pivot, that expenditure and effort could be wasted — and you may need to navigate the complex legal process of dissolving the entity.
A global HR partner provides greater flexibility and reduced commitment. For example, you can pilot a region by engaging independent contractors first; this enables fast international hiring and makes it straightforward to sever ties if necessary. Remote’s Contractor Management platform lets you hire, onboard, and manage contractors simply and cost-effectively.
If the pilot succeeds and you decide to hire employees in-market, you can use an employer of record (EOR) service — such as the one offered by Remote. An EOR enables you to lawfully employ people abroad without the time, cost, and complexities involved in setting up an entity. This lets you scale international hiring across multiple markets quickly while remaining compliant. As you expand worldwide, you can also draw on Remote’s localised HR, tax, benefits, and payroll knowledge. That saves you the effort of sourcing local suppliers and helps ensure ongoing compliance with labour and tax laws.
We will explain this process in greater detail below.
What is the best time for international expansion?
Timing matters when entering a new market. But how can you tell if the moment is right to expand?
Below are some indicators that it may be an appropriate time to look beyond your borders:
If your domestic market has reached saturation and growth prospects are limited, it may be sensible to investigate international expansion. However, ensure your business is stable and performing well at home before branching out.
If you receive a notable volume of orders or enquiries from customers in a specific foreign market, this could signal an opportunity for growth in that region.
If your research identifies strong demand for your offering, low competition, or favourable economic or regulatory circumstances in a foreign market, this could indicate an opportune moment to expand.
Does your business have a unique product, service, or technology that would give it an edge in a foreign market? If so, it may be worthwhile to capitalise on this advantage through expansion.
If your products or services can be adapted readily to a foreign market and there is clear demand, your chances of success abroad will improve.
Hire anywhere with Remote's EOR
Whether you seek to employ a single international worker or thousands, Remote has the infrastructure, expertise, and experience required. Our leading employer of record services deliver a world-class experience for your global team — and dependable pricing, legal safeguards, and reassurance for your business.
There are numerous reasons why international expansion could suit your business, including:
Talent acquisition
One of the major benefits of international expansion is the ability to tap into new talent pools.
Employing overseas staff gives your company access to fresh skill sets and perspectives, enhancing diversity and inclusion. According to McKinsey, this can boost creativity and productivity, with diverse teams 33% more likely to outperform their peers.
Hiring international talent can also be more cost-effective, particularly when team members operate remotely.
Remote can help you find top talent in overseas markets, and hire, onboard, and manage them quickly and with ease.
Brand exposure
International expansion increases your visibility and reputation in new markets, introducing you to a broader audience and building trust. This raises brand recognition and, in time, revenue.
Happier employees
When you hire globally, employees often value the remote model and its benefits. In our most recent Global Benefits Report, we found that 78% of remote workers were more satisfied with their benefits package, compared with 60% of on-site employees.
This improved engagement enhances retention and makes your company more dynamic. In our 2023 Remote Workforce Report, 72% of companies reported that their teams became more productive after adopting a remote, globally distributed workforce.
Increased revenue
As noted, global expansion opens access to new markets and customer segments, unlocking additional revenue streams. It can also help you outperform peers: businesses that expand internationally generate an extra 1.9% in annual shareholder returns over competitors that do not expand.
McKinsey also reports that firms already experiencing strong domestic growth gain an additional 2.6% in annual returns from international expansion.
Potential cost savings
Alongside revenue gains, expansion can yield cost advantages. For instance, entering markets where resource, material, and salary costs are lower can present savings opportunities.
Localised insight
When entering new markets, local insight and expertise are essential. Lacking them risks alienating — or even offending — local audiences and partners, whether through avoidable communication errors or deeper cultural mismatches. You may also be unfamiliar with local business practices, wasting time and money.
Hiring people on the ground who understand the culture helps you avoid such mistakes. Whether you engage consultants on a contract basis or appoint a permanent employee to oversee operations, Remote can help you find and hire 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 establish brand recognition and credibility. Early entry can deliver a meaningful advantage over rivals.
Even as a small or mid-sized firm, you can make significant impact if your product or service fits the market well.
Market protection
A global footprint lets you exploit varied market trends and customer preferences, diversifying revenue streams and mitigating the impact of local downturns.
Operating in multiple markets reduces exposure to regional recessions; a downturn in one country may be offset by stronger performance elsewhere.
This can stabilise your overall business during macroeconomic volatility.
Customer support coverage
If you have a meaningful customer base in a particular region or language group, expansion enables you to serve them far more effectively.
You can recruit customer support specialists with local language and cultural knowledge, delivering a smoother experience for customers. This approach scales, allowing dedicated local CS teams in each market you enter.
Strategic partnerships and collaborations
Expanding internationally provides a platform to form strategic global partnerships and collaborations that might otherwise be inaccessible.
Such relationships can stimulate innovation and grant access to new markets or operational efficiencies through knowledge and technology transfer.
What are the challenges of international expansion?
International expansion brings many advantages but is, unsurprisingly, not straightforward. Even under favourable conditions, success is not guaranteed — regardless of sector or company size.
The statistics underline this: companies that expand abroad can record an average return on assets (ROA) of -1% for up to five years. Indeed, only 40% of companies achieve a ROA of 3% or higher.
Therefore, it is vital to recognise common pitfalls of global expansion and to know how to mitigate them. Below are key challenges you should anticipate.
Local legislation and regulations
Failing to comply with local labour and tax laws can result in penalties, legal action, or restrictions on trading. Navigating the complexities of foreign legal systems can be time-consuming and difficult, especially where rules change frequently.
This is why partnering with an experienced global HR provider is strongly recommended. Remote assists you in complying with labour and tax laws wherever you hire, allowing you to concentrate 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 labour laws, taxes, accounting, translation, and payroll responsibilities.” Mona Walther, Senior People Operations Manager at commercetools
See our Country Explorer tool to review available countries and roadmaps.
Market differences
Many firms err by trying to replicate domestic strategies abroad. Successful expansion demands a nuanced understanding of local dynamics, consumer preferences, and cultural subtleties.
For example, a number of fintech firms are currently expanding internationally. These firms often prioritise engineering and product work.
However, they may lack experience in developing cross-border go-to-market strategies or in selecting suitable campaigns, channels, and messaging. This is why it is important to hire the right people who possess strong knowledge of your target market.
Cultural differences
Cultural variation affects communication, negotiation, and people management. Insufficient cross-cultural awareness can produce misunderstandings, strained relationships, and potential failure.
Again, hiring local international employees is recommended. Local staff understand their own customs and can provide valuable, potentially transformative insights. They also bring networks that help you navigate the local business landscape.
Competition in foreign markets
Overseas markets can be intensely competitive, with both local and international players vying for share. Understanding the landscape and differentiating your offering are essential.
Global competition has risen rapidly, making a well-defined competitive strategy vital when expanding internationally.
Time and money
International expansion often requires substantial up-front investment, including:
Legal and regulatory compliance
Setting up local operations
Building distribution networks
Additionally, you may need to invest time and funds in developing local partnerships and recruiting and training staff.
These costs can be significant. For example, establishing legal entities may take up to 12 months and cost over $100,000 per location, depending on the country and ongoing administration.
To avoid these burdens, consider partnering with an expansion provider such as Remote. With our EOR services, you can hire across multiple countries without setting up a single entity — and be operational within days.
To understand how an EOR functions, see our detailed guide.
Logistical issues
Depending on your offering, logistical matters — such as transport, supply chain management, and customs — can present major obstacles. Moving goods across borders demands careful planning to maintain efficiency.
To deliver products and services to customers, you require an effective distribution network and robust infrastructure.
Banking and currencies
Expansion typically entails handling multiple currencies, banking systems, and financial regulations. You must manage foreign exchange exposure, build banking relationships, and navigate cross-border payment mechanisms.
You also need a plan to pay employees and contractors in the new country. Remote can simplify this through our EOR, centralised payroll, or contractor management services.
How to pay your global employees
Global Payroll How to pay international employees
Data regulations
Data regulation is a complex element of international operations. Rules vary by country and affect how you store and manage data across borders.
Consequently, stay informed about current data regulations to reduce compliance risk and safeguard 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, protecting products, ideas, and branding is essential. Securing patents, trademarks, and copyrights where applicable helps preserve your IP.
You should also have measures to prevent IP theft or copying in accordance with local IP laws, and be prepared to handle legal disputes in local courts if necessary.
Remote can help you protect your IP when working with employees and contractors abroad.
Cybersecurity breaches
Cyber and data breaches are widespread globally, and suffering one can be damaging. According to IBM, 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 challenging, especially when expanding internationally. Different jurisdictions have varying rules on data protection, and staying up to date is essential.
Cross-border data transfer carries risks, and securing remote employees and their devices presents additional complexity. Home workers may use personal devices, increasing vulnerability.
Consequently, ensure employees are trained in safe online practice and adopt modern tools and procedures to maintain robust cyber defences.
If you choose a global HR partner, verify that its security meets your standards. Remote, for example, employs enterprise-grade data protection and security practices and maintains a dedicated security team for support. 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 an actionable expansion plan actually look like?
As discussed, expansion is more than establishing a presence abroad; it requires market understanding, local relationships, and careful navigation of cultural and regulatory subtleties.
Below is an outline of the steps you may follow, and how Remote can support you at each stage.
Begin by taking time to understand the market dynamics. Analyse data, conduct assessments, and gain a clear picture of consumer behaviour and preferences in the target market.
Examine market trends and identify the growth potential for your business. Include macroeconomic and demographic factors in your analysis.
Anticipate entry barriers such as cultural differences, language obstacles, and regulatory limits. Understanding these in advance enables you to devise solutions or reassess the market’s viability. Identifying your mode of entry Determine how you will enter the market given your resources and risk tolerance. Each entry route — exporting, licensing, M&A, or direct investment — has distinct advantages and drawbacks, so define your risk/reward threshold.
For instance, exporting may be lower risk but offers less control; licensing can provide rapid access but may raise quality or brand concerns. Be sure to document your chosen plan.
After research and selecting an entry route, prepare an expansion plan. This should function as a roadmap and address several areas, including:
Financial plan : Assess your budget for market entry and ongoing operational costs. Account for exchange rates and financing options that may affect capital structure and cash flow.
Establish realistic revenue and profit forecasts based on market research and consider multiple scenarios—optimistic and pessimistic—to provide clear financial goals.
Risk assessment: International business involves political, economic, cultural, and compliance risks. Conduct a thorough risk assessment, evaluating likelihood and impact on operations, finances, and reputation.
Once risks are identified, create mitigation strategies and contingency plans to ensure operational resilience and rapid recovery from unforeseen events. With robust risk management, your expansion strategy becomes more adaptable and durable.
Infrastructure and logistics plan: Depending on your business, plan for both physical and digital infrastructure and logistics needs.
This may include mapping your supply chain, logistics, and transportation arrangements to ensure smooth operations for all stakeholders.
This phase prepares you for market entry and may involve:
Securing any required funding
Preparing your digital and/or physical infrastructure
It is essential to understand the legal and regulatory obligations of your target market to avoid fines, penalties, and reputational harm. This includes employment law, IP protection, tax and accounting duties, and entity formation requirements.
You can engage local lawyers and tax specialists, but this is time-consuming and costly. An EOR provider like Remote handles the legal complexities more quickly and economically.
This approach enables you to begin hiring the people who will drive your expansion within days.
This stage is when you establish a viable presence in the new market. This could include opening a local office or hiring local staff and ensuring you have on-the-ground resources for effective operations.
You will also begin executing your marketing plan to build brand awareness and attract customers.
Once operational, the emphasis shifts to scaling and expanding the customer base. This stage involves ongoing marketing, acquisition, and retention activities and is often focused on performance metrics and return on investment (ROI).
At this phase, your business has an established market presence. The priority is continuous operational improvement and refining offerings in response to customer feedback and market trends. Stability requires ongoing effort to remain competitive and relevant.
HR considerations when expanding internationally
Building your team
Arguably the single most important factor in the success of your expansion is this step.
“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
However, hiring in a new market can be complex. You must understand local workforce expectations and culture, including salary and benefits norms, and the many differences in labour law such as minimum wage, overtime, and working hours.
With Remote, you need not be concerned. Our all-in-one platform supports every stage of the hiring lifecycle, allowing you to concentrate on core business activities. Here is how we help:
Recruitment
The first step is identifying the right candidates. There are various channels for this, including local job boards, social networks, and referrals.
You can also use Remote Talent to assist with hard-to-fill roles; our remote jobs board connects you to a global pool of candidates.
Using our EOR service, you can also offer the best local benefits to make attracting top talent simpler.
Hiring
After selecting a candidate and making an offer, you can onboard them rapidly via our EOR service or, if they are contractors, through our Contractor Management service.
This approach is useful in new markets, allowing you to “test the waters” with independent contractors before full commitment. You can also convert contractors to employees easily with us, ensuring you do not accidentally misclassify your people.
“Companies are increasingly recognising the advantages of accessing skilled freelancers who contribute on a project basis, offering expertise without long-term commitments. Notably, this trend is not limited to Western countries but is growing in developing markets as well.”
-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 the recruit rethink their decision and risk losing them.
When hired via Remote’s EOR, new team members receive a personalised welcome and comprehensive guidance throughout onboarding. We ensure the process is fast, straightforward, and compliant, and provide each hire with a dedicated HR manager.
This service extends to contractors as well: we ensure full compliance and provide the same 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 rapid. Regardless of location, Remote streamlines payroll and enables you to run it in minutes.
If you use our EOR service, payroll is integrated: we perform calculations, make statutory deductions, and pay employees punctually. We also provide in-house support for payroll queries. Learn more about EOR payroll management.
If you set up your own legal entity in the new market, we can also provide payroll as a standalone service. Learn more about Global Payroll.
You can also manage and settle contractor invoices with a few clicks — and in multiple currencies. Learn more about paying independent contractors.
Managing team members
Managing daily HR needs for your international workforce is straightforward with Remote. We provide a fully free HRIS that helps consolidate your HR stack and run everything centrally. It enables employees to self-serve HR tasks such as time tracking, expense claims, and document access.
"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 key benefit of expanding with Remote is unlimited growth potential: our platform and services scale with you globally. As you expand your workforce and enter new countries, you need not change providers or modify processes — a limitation frequently encountered with local suppliers.
Whether recruiting, hiring, onboarding, paying, or managing, we handle every element of global HR — from your first hire to your thousandth and beyond.
Examples of successful international expansion
Remote has supported organisations of varied sizes to expand internationally, including:
Loom
Loom, one of the world’s largest video communications platforms, used Remote’s global infrastructure to expand its team across multiple countries.
With an extraordinary 900% year-on-year growth in 2021, Loom’s global talent pool was essential to meeting demand. Yet international hiring introduced multiple complexities.
With 15 people spread across 11 countries, Loom’s HR team found it difficult to keep pace with local hiring rules. Establishing international hubs and dedicated management was not feasible.
Remote covered Loom’s international employees and entities, offering transparent and fair pricing through its EOR service. This partnership enabled Loom to convert contractors to employees, adding legitimacy and enhancing the employee experience.
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 accessed a diverse talent pool while ensuring compliance with local laws. This has supported the company’s growth and improved the employee experience.
Primer
Primer, a leading fintech firm, utilised Remote’s infrastructure and expertise to manage the complexities of international hiring.
Recognising remote work’s potential, Primer sought global talent. Expanding across countries introduced a distinct set of challenges.
Partnering with Remote gave Primer the tools to hire internationally, with Remote’s EOR providing transparent and fair pricing. This ensured compliance with local rules and let Primer focus on its core mission of 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 the overall employee experience. As a result, the company expanded successfully across borders while maintaining a strong focus on employee satisfaction.
Read more about Primer’s story.
Seatti
Technology company Seatti partnered with Remote to transform its global hiring and talent management approach.
Like others, Seatti wanted to support international growth by hiring in new markets, but global employment complexities presented a substantial challenge.
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 promoting a culture of innovation and diversity.
Read more about Seatti’s story.
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Expand internationally with Remote
As demonstrated, international expansion offers significant benefits but also a variety of challenges.
Remote’s integrated global HR solution is designed to assist you at every stage. We enable consolidation and growth in new markets by helping you hire, manage, and pay top local talent while complying with evolving labour and tax regulations.
Whether you plan to hire one employee or contractor in a different country, or hundreds across several countries, we provide everything you need within a single platform. When guidance is required, our in-house, on-the-ground experts are available 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.