HR international expansion guide
Expand internationally quickly and securely
Expanding overseas presents a demanding yet rewarding opportunity for businesses aiming to access global markets and hire top talent. However, unfamiliar regulations, cultural differences and administrative overhead can generate material risks and costs.
Drawing on our experience as a global HR platform that has itself expanded internationally, we provide all the tools required to overcome those challenges. We also advise on decision-making and help you deploy resources efficiently as you enter new territories.
Our perspective on global expansion is based on hands-on experience. We have built and scaled a team of more than 1,000 employees across 70+ countries and work with customers on every continent. We understand what successful international expansion requires.
What you will learn in this guide
This guide draws on that experience and expertise to deliver practical advice and tactical insights. It sets out proven steps not only to enter new markets, but to scale responsibly and achieve long-term success.
Specifically, we will:
Examine ways to build a resilient global presence
Review localised strategies to shield your business from cultural and regulatory risks in new markets
Present the fundamental principles of sustainable expansion
Outline the tools and processes that simplify the whole process
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 its home market into another country. This enables the organisation to broaden its market reach.
Recruiting international talent is often central to a global expansion approach, as the right appointments provide a strong foundation and essential local market knowledge.
Expanding into foreign markets can be intimidating for any business — especially small and medium-sized enterprises. The process is complex, time-consuming and liable to unexpected risks. With the right plan and tools, however, the potential rewards can be substantial. What does international expansion look like?
Historically, companies commonly established legal entities in target countries to expand. Today, organisations increasingly pursue alternative, more cost‑efficient routes to grow internationally.
Crucially, international expansion is not limited to large incumbents. Globalisation and technological advances now make it feasible for small firms 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
Regardless of company size, several routes exist for international expansion. These include:
Exporting
Exporting means selling goods or services to customers overseas, either through physical shipments or online channels.
Exporting can include international e‑commerce. With global payment providers and storefront platforms such as Amazon, Shopify and BigCommerce, you can market and sell across borders without establishing a physical presence.
Licensing
Licensing is when you grant another company the rights to use your intellectual property (IP) — for example trademarks, patents or copyrights — in return for royalties or fees. It lets you extend your brand and capabilities into new markets without operating there directly.
This model suits businesses with IP—such as software or technology—with broad applicability, or those with strong brand recognition.
Acquisitions and mergers
Acquiring or merging with a foreign company is another common strategy, with cross-border M&A activity growing in recent years.
This development highlights the strategic benefits of acquiring or merging with established companies to gain market access, technology and customer bases.
Joint ventures and strategic alliances
Joint ventures and strategic alliances are formal cross-border partnerships designed to access resources, expertise and market reach. They enable market entry, risk-sharing and the combining of complementary strengths.
Unlike a merger, the aim is to form a mutually advantageous collaboration, often with firms in different sectors.
Direct investment
Direct investment involves putting capital into a foreign company to obtain a degree of management or operational control.
Some investors establish a physical presence—such as a subsidiary or branch—to exert greater influence over operations in the foreign market.
This approach is growing in popularity, with more firms increasing investment in underdeveloped markets 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. It must set out the concrete steps your company will take to meet its 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 paths:
International strategy
With an international strategy, your company supplies foreign markets from production in the home country. This lets you leverage existing manufacturing and capabilities to serve overseas customers.
Exporting allows you to meet international demand without local production, enabling a consolidated growth approach that leverages your current strengths and know-how.
This approach is commonly favoured by small businesses and startups.
Multinational strategy
A multinational strategy involves operating in several countries and adapting products or services to local conditions, recognising distinct market preferences, cultural norms, and regulations.
To serve these markets effectively, your company may:
Modify products or services to match local demand
Tailor marketing and communication strategies
Establish local production or distribution facilities
This strategy focuses on meeting specific customer needs in each country while sustaining a global presence.
Global strategy
Under a global strategy, your company functions as a single organisation delivering a standardised product or service across markets. The emphasis is on standardisation rather than adaptation, exploiting economies of scale and efficiency.
The strategy simplifies operations, supports centralised decision-making and leverages your global brand recognition.
It is generally preferred by larger, well established businesses.
Do you need to set up a legal entity to expand internationally?
Not necessarily. That depends on your company’s objectives and available resources.
For some businesses, establishing a legal entity makes sense—if funding and time are available and it aligns with strategic goals, it can yield the greatest benefits.
For many firms—particularly startups and small businesses—creating legal entities in multiple countries is impractical.
Beyond the resource cost, forming a legal entity is a major commitment. If plans change, the investment and effort may be lost, and you may face the complex process of dissolving the entity.
With a global HR partner, you gain greater flexibility and lower commitment. For example, you can pilot a region using independent contractors; this enables fast international hiring and simple exit if needed. Remote’s Contractor Management platform lets you hire, onboard, and manage contractors in a straightforward, cost-effective way.
If expansion goes well and you need to employ staff, use an employer of record (EOR) service — like the one offered by Remote. An EOR permits legal employment overseas without time, cost, and complexities involved in opening an entity. This lets you scale international hiring quickly and compliantly. As you expand further, you can draw on Remote’s localised HR, tax, benefits, and payroll expertise, saving time that would otherwise be spent sourcing local providers and helping ensure ongoing compliance with labour and tax rules. As you continue to expand across the globe, you can also leverage Remote’s localized HR, tax, benefits, and payroll expertise. This saves you the time and effort of finding local providers, and helps ensure that you’re always compliant and up-to-date with local labor laws and tax regulations.
We explain how this works in more detail below.
What is the best time for international expansion?
Timing is a key factor when entering a new market. But how do you tell when the moment is right to expand?
Signs that it may be time to look beyond your borders include:
If your home market is saturated with limited growth prospects, it may be appropriate to explore international expansion. Ensure your domestic business is stable before branching out.
A substantial volume of orders or enquiries from a particular foreign market can signal a viable growth opportunity there.
If research shows strong demand, limited competition, or favourable economic or regulatory conditions in a foreign market, this may indicate a good moment to expand.
If your business offers a distinctive product, service or technology that gives an edge in a foreign market, it may be worth capitalising on that advantage by expanding internationally.
If your product or service can be readily adapted to a foreign market where clear demand exists, your likelihood of success abroad improves.
Hire anywhere with Remote's EOR
Whether you need to hire a single international worker or thousands, Remote has the infrastructure and expertise required. Our industry-leading employer of record services deliver a world-class experience for your global team — and dependable pricing, legal protections, and peace of mind for your business.
There are several reasons why going global might suit your business, including:
Talent acquisition
A major benefit of expanding internationally is the ability to tap into new talent pools.
Hiring overseas staff provides access to fresh skills and perspectives and improves diversity and inclusion. A landmark McKinsey study found diverse teams are 33% more likely to outperform their peers.
Hiring international talent can also be cost-effective, particularly when team members work remotely.
Remote can help you find top talent in foreign markets, and hire, onboard, and manage them quickly and easily.
Brand exposure
International expansion raises your visibility and reputation in new markets, exposing you to a broader audience and building familiarity and trust, which in turn boosts brand recognition and revenue.
Happier employees
Hiring globally often increases employee satisfaction with remote working and benefits. In our most recent Global Benefits Report, 78% of remote workers reported greater satisfaction with benefits versus 60% of on-site staff.
That engagement improves retention and dynamism. In our 2023 Remote Workforce Report, 72% of companies reported increased productivity after adopting a remote, distributed workforce model.
Increased revenue
Global expansion opens new markets and customer segments, unlocking revenue streams. It can also help you outperform peers, with businesses that expand internationally delivering an extra 1.9% in annual shareholder returns compared with competitors that do not expand.
McKinsey also finds that companies with strong home‑market growth can gain an additional 2.6% in annual returns from international expansion.
Potential cost savings
Alongside revenue gains, expansion can offer cost savings — for example, entering markets where the cost of resources, materials and salaries is lower.
Localised insight
When entering new markets, local insight and expertise are essential. Without them, you risk alienating or offending local audiences through avoidable communication errors or cultural missteps, or you may be unfamiliar with local business customs and processes, costing time and money.
Hiring local people who understand the culture helps avoid such errors. Whether you engage consultants on a contract basis or appoint a permanent local employee, 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 method to build recognition and credibility. Being first can secure a meaningful advantage.
Small and mid-sized businesses can still achieve significant impact with the right product or market fit.
Market protection
A global presence lets you exploit diverse market trends and preferences, diversify revenue streams and mitigate potential shifts going forward.
Operating across multiple markets reduces the effect of localized downturns; weaker performance in one country may be offset by stronger results elsewhere.
This helps preserve the overall stability of your business during macroeconomic turbulence.
Customer support coverage
If many customers are concentrated in a region or share a language, expansion enables more effective localised support.
Hiring local customer support specialists fluent in the language and familiar with the culture creates a smoother experience. This approach scales, allowing dedicated local CS experts in each country you operate in.
Strategic partnerships and collaborations
Expanding globally provides a platform to form strategic international partnerships and collaborations that may otherwise be out of reach.
Such relationships can spur innovation, open new markets and improve operational efficiency through knowledge and technology transfer.
What are the challenges of international expansion?
International expansion brings benefits but is rarely straightforward. Even under favourable conditions, success is not guaranteed.
This is reflected in the data: companies that expand abroad report an average return on assets (ROA) of -1% for up to five years. Indeed, only 40% of companies are able to surpass a ROA of 3% or more.
Hence, it is vital to recognise common pitfalls of global expansion and how to address them. Here are some of the key challenges you will likely face.
Local legislation and regulations
Failing to comply with local labour and tax laws can lead to fines, legal action and even restrictions on trade. Unravelling foreign legal frameworks can be complex and time-consuming—especially where rules change frequently.
Therefore, working with an experienced global HR partner is highly advisable. Remote helps ensure compliance with labour and tax laws wherever you hire, letting you 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 labor laws, taxes, accounting, translation, and payroll responsibilities.” Mona Walther, Senior People Operations Manager at commercetools
Use our Country Explorer tool to view available countries and roadmaps.
Market differences
A common mistake is replicating domestic strategies abroad. Successful expansion requires deeper insight into local market dynamics, consumer preferences and cultural subtleties.
For example, fintech firms expanding internationally often prioritise engineering and product development.
They may lack experience in planning cross‑border go‑to‑market (GTM) approaches, or in selecting appropriate channels and messaging. This is why it’s important to hire the right people who understand the target market.
Cultural differences
Cultural differences affect communication, negotiation and employee management. A lack of cross‑cultural awareness can cause misunderstandings, strained relations and potential failure.
Again, hiring local employees is advisable. They understand local customs and can provide valuable insights and networks to navigate the business environment.
Competition in foreign markets
Foreign markets are often highly competitive, with local and international players contending for share. Understanding the landscape and differentiating yourself is essential.
Global competition has intensified in recent years, making a clear competitive strategy essential when expanding internationally.
Time and money
International expansion can require substantial upfront investment, including:
Legal and regulatory compliance
The establishment of local operations
The development of distribution networks
Additionally, you should budget time and funds to build partner relationships and recruit and train a local workforce.
Costs add up; for example, establishing legal entities can take up to 12 months and exceed $100,000 USD per location, depending on local requirements and ongoing administration.
To sidestep these expenses and delays, consider an expansion partner such as Remote. Using our EOR services, you can hire in multiple countries around the world without creating a single entity — and be operational in a matter of days.
To learn how an EOR works, see our in-depth guide.
Logistical issues
Logistics — transportation, supply chain management and customs rules — can create major obstacles depending on your product or service. Cross‑border movement of goods requires careful planning and coordination for efficiency.
An effective distribution network and resilient infrastructure are necessary to deliver products and services to customers.
Banking and currencies
Expanding internationally typically means handling multiple currencies, banking systems and financial regulations. You must manage foreign exchange risk, set up banking relationships and navigate international payment systems.
You must also decide how to pay employees and contractors in the new country. Remote can simplify the process 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 regulations are a complex aspect of international operations. They vary by country and influence how you manage and store data across borders.
Therefore, stay informed of current data regulations and requirements 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, protect your products, ideas and brand. Securing patents, trade marks and copyrights where appropriate is essential to preserve your IP.
You need measures to prevent IP theft or copying in accordance with local IP laws and plans to address any legal disputes 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 worldwide, with severe consequences. According to IBM, the average cost of a data breach in the US in 2022 was $9.5 million USD.
Protecting against cyber threats and data leaks is challenging, especially during international expansion. Rules differ across regions, so you must remain up to date.
Cross‑border data transfers pose risk, and securing remote employees and their devices is complex. Home workers using personal devices further increase vulnerability.
Consequently, ensure employees are trained in online safety and that you deploy modern tools and best practices to maintain robust cyber defences.
If you choose a global HR partner, verify its security standards. Remote uses enterprise‑grade data protection and security protocols 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, what does a practical expansion plan look like?
International expansion involves more than planting a flag. It requires market understanding, local relationships and navigation of cultural and regulatory subtleties.
Below is an overview of possible steps and how Remote can assist.
Ensure you allocate time to understand the target territory’s dynamics. Analyse data, carry out assessments and gain a clear understanding of consumer behaviour and preferences.
Investigate market trends and estimate growth potential, taking macro‑economic and demographic factors into account.
Finally, assess barriers to entry such as cultural differences, language issues and regulatory restrictions. Understanding these challenges allows you to find solutions or reassess whether to enter that market. Determine your mode of entry—exporting, licensing, merging or direct investment—each option carries a distinct risk/reward profile, so define your tolerance.
For example, exporting is lower risk but offers less market control; licensing can provide rapid access but may create quality or brand risks. Make sure you document your plan formally.
After research and selecting an entry route, develop an expansion plan that serves as a roadmap covering areas such as:
Financial plan : Account for market entry costs and ongoing operational expenses. Factor in currency exchange rates and possible financing options that may affect capital structure and cash flow.
Set realistic revenue and profit projections based on market research and scenario planning.
Risk assessment: Identify political, economic, cultural and compliance risks. Assess probability and impact and how each might affect operations, finances and reputation.
Develop mitigation and contingency plans so your expansion is resilient, flexible and able to recover quickly from setbacks.
Infrastructure and logistics plan: Depending on your business, plan both physical and digital infrastructure needs.
This can include mapping supply‑chain processes, logistics and transportation to ensure smooth operations for all stakeholders.
This stage covers market entry preparation and can include:
Finalising and securing necessary funding
Preparing digital and/or physical infrastructure
Understand local employment, IP, tax and accounting obligations, as well as entity formation requirements, to avoid fines and reputational damage.
You could engage local lawyers and tax specialists, but this is time‑consuming and costly. Using an EOR such as Remote is quicker and more cost‑effective, as it handles most legal work at a lower cost.
This enables you to start hiring the people who will drive expansion within days.
In this phase you establish a viable market presence—opening a local office or hiring staff and ensuring you have on‑the‑ground resources for effective operations.
You will also deploy marketing to build brand awareness and attract customers.
When operational, the focus shifts to scaling and growing your customer base through an ongoing cycle of marketing, acquisition and retention, emphasising performance metrics and ROI.
At maturity, the business has an established market presence. Focus on continuous improvement and refinement of products and services based on feedback and market trends — maintaining competitiveness requires ongoing effort.
HR considerations when expanding internationally
Building your team
Arguably, this is the most critical factor determining expansion success.
“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 understand workforce expectations, salary and benefits norms, and differing labour laws such as minimum wage, overtime and working hours.
With Remote, you can rely on an all‑in‑one platform that covers each stage, allowing you to focus on core business. Here is how it works:
Recruitment
First, identify the right candidates. Use local job boards, social networks and referrals among other channels.
You can also use Remote Talent to fill challenging roles — our remote jobs board opens access to global talent.
With our EOR service, you can also hand pick and offer the best local benefits, improving your ability to attract top candidates.
Hiring
After making an offer, hire the candidate quickly via our EOR service or, for contractors, via our Contractor Management service.
This is useful for new markets as it lets you “test the waters” with contractors before committing. You can convert contractors to employees with us, ensuring you do not accidentally misclassify your people.
“Companies are increasingly recognizing 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 of a new hire’s lifecycle. A poor experience may cause doubts and alienation.
Hiring via Remote’s EOR gives new hires a personalised welcome, step‑by‑step guidance and a swift, compliant onboarding experience. We assign each new hire their own HR manager.
The same applies to contractors: we ensure compliance and provide the same 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 safe, fast and simple. Wherever your workforce is located, Remote simplifies payroll so you can run it in minutes.
With our EOR service, payroll is integrated: we calculate deductions, pay employees on time and offer in‑house payroll support. Learn more about EOR payroll management.
If you choose to open your own legal entity, we can provide payroll as a standalone service. Learn more about Global Payroll.
You can manage and pay contractor invoices in a few clicks and in multiple currencies. Learn more about paying independent contractors.
Managing team members
Remote simplifies daily HR for international teams. We provide a fully free HRIS, allowing consolidation of your HR stack and centralised operations. Employees can self‑serve tasks such as time and attendance tracking, expense management and document handling.
"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 unlimited scalability; our platform and services scale with you worldwide. As your workforce grows and you enter new countries, you do not need to change providers or alter processes. This is often not the case with local or smaller providers.
From recruiting and hiring to onboarding, payroll and management, we handle every element of global HR — from your first hire to your thousandth and beyond.
Examples of successful international expansion
Remote has supported companies of various sizes to expand internationally, including:
Loom
Loom, a leading video communications platform, leveraged Remote’s global infrastructure to expand its team across multiple countries.
Following 900% year‑over‑year growth in 2021, Loom relied on a global talent pool to meet demand, but international hiring brought significant complexities.
With 15 staff across 11 countries, Loom’s HR team found it difficult to comply with local hiring regulations, and creating international hubs was impractical.
Remote covered Loom’s international locations and entities, offering transparent EOR pricing. The partnership allowed Loom to convert contractors to employees, delivering legitimacy and a better experience for their 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 accessed a diverse talent pool while remaining compliant with local laws. This has enabled the company to grow and improved the employee experience.
Primer
Primer, a prominent fintech company, used Remote’s infrastructure and expertise to navigate the complexities of international hiring.
Recognising remote work’s potential, Primer sought global talent, but expanding across countries posed challenges.
Primer’s partnership with Remote supplied the tools and resources to hire internationally, with
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 converted contractors to full-time employees, providing a more consistent experience and enabling successful expansion while maintaining employee satisfaction.
Read more about Primer’s story.
Seatti
Seatti, a technology company, partnered with Remote to transform its global talent acquisition and management.
Seatti wanted to support international growth through local hires, but global employment complexities posed a major 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 service ensured Seatti complied with local laws, enabling cross‑border team expansion and fostering innovation and diversity.
Read more about Seatti’s story.
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Expand internationally with Remote
International expansion offers significant rewards but also many challenges.
Remote’s all‑in‑one global HR solution helps you address these challenges at every stage. We help you consolidate and expand into new markets by hiring, managing and paying top local talent while ensuring compliance with relevant and evolving labour and tax laws.
Whether hiring a single employee or contractor abroad or hundreds across multiple countries, we provide everything you need in one streamlined platform. When you need support, our in‑house, on‑the‑ground professionals are available to help.
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.