HR international expansion guide
Expand worldwide quickly and securely
Growing internationally presents both complex challenges and strong rewards for firms aiming to reach new markets and hire leading talent. However, unfamiliar regulations, cultural differences, and administrative burdens can create considerable costs and risk.
As a top global HR platform with first-hand experience of international growth, we equip you all the practical tools needed to navigate these obstacles. We also support your decision-making and help you make the most of your resources as you move into new territories.
When we discuss global growth, we speak from experience. We have grown a team of more than 1,000 employees across 70+ countries and serve customers on every continent. We understand what’s required to expand successfully overseas.
What you'll learn in this guide
In this guide, we draw on that knowledge and offer practical, actionable advice and tactical insight. You’ll receive tested guidance not only on entering new markets, but on scaling in a way that’s sustainable and sets you up for long-term success.
Specifically, we’ll:
Discuss how to nurture a strong global presence
Explore localised approaches that guard your business against cultural and regulatory issues in new markets
Introduce the fundamental principles of sustainable expansion
Highlight the tools and processes that can streamline the entire journey
Table of contents
What is international expansion?
Effective expansion strategies
Building an international team
What is international expansion?
International expansion happens when a business extends its operations from its domestic market into a foreign market. Doing so broadens your organisation’s market reach.
Hiring talent abroad is often central to a global expansion plan, because the right hires can build a strong base and bring essential local market knowledge.
The idea of moving into foreign markets can seem intimidating for any business, and particularly for small and medium-sized enterprises. The process can be complicated, slow, and full of unanticipated risk. Yet with the correct strategy and tools, the potential rewards may be substantial.What does international expansion look like?
Historically, expanding overseas usually required companies to establish legal entities in target countries. As the landscape evolves, businesses are now considering alternative — and often more cost-efficient — routes to global growth.
Crucially, international expansion is no longer the preserve of large incumbents. Globalisation and technological advances have made it easier for smaller 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
No matter the size of your company, there are several pathways to international growth. These include:
Exporting
Exporting means selling goods or services to customers in other countries, either physically or online.
Export strategies vary, such as international ecommerce. With global payment providers and storefront platforms like Amazon, Shopify, and BigCommerce, you can sell worldwide without establishing a physical presence in those markets.
Licensing
Licensing is when your firm grants another company the right to use your intellectual property (IP) — for example trademarks, patents, or copyrights — in return for royalties or fees. This extends your brand and expertise into new markets without you operating there directly.
This route can work well if you own IP — such as software or a technology — with multiple applications, or if your brand already has recognition.
Acquisitions and mergers
Acquiring or joining forces with a foreign company is another common approach, and cross-border mergers and acquisitions have grown strongly in recent years.
This trend highlights the strategic value of buying or merging with existing firms to gain market access, new technologies, and customer bases.
Joint ventures and strategic alliances
Joint ventures and alliances are formal partnerships between firms in different countries designed to access new resources, expertise, and market reach. Such collaborations let you enter markets while sharing risks and leveraging complementary strengths.
Unlike a merger, the aim is to form a mutually beneficial partnership, often with organisations in different sectors.
Direct investment
Direct investment means putting capital into a foreign company to gain some control over its management or operations.
Some investors go further by establishing a physical footprint in the target country, typically via a subsidiary or branch office. This provides greater control and influence over operations in the foreign market.
This approach is increasingly popular, with many businesses boosting investment in 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 'true north', it should list the concrete steps your business will take to reach its international 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 approach, your firm exports products or services to foreign markets while keeping production in your home country. This lets you leverage existing production capabilities to serve overseas customers.
Exporting in this way lets you meet international customer needs without local production facilities. It supports a consolidated growth model that builds on your company’s current strengths while widening its reach.
Smaller firms and startups often favour this route.
Multinational strategy
With a multinational approach, your company operates in several countries and adapts products or services for local market conditions, recognising that markets differ in 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 communication strategies
Establish local production or distribution facilities
This model focuses on addressing specific customer needs and preferences in each country while maintaining a global footprint.
Global strategy
A global strategy treats your company as one unified entity offering a standardised product or service across countries. The emphasis is on uniformity rather than local adaptation, leveraging economies of scale and operational efficiency.
This streamlines operations, supports centralised decision-making, and benefits from global brand recognition.
It tends to suit larger, well-established companies best.
Do you need to set up a legal entity to expand internationally?
Not always. The answer depends on your company’s objectives and resources.
For some firms, establishing a legal entity is the correct strategy. If you have the budget and time, and it aligns with your goals, this can be the most advantageous route.
For many businesses — particularly startups and small firms — opening legal entities in multiple countries is unrealistic.
Beyond the resources required, forming a legal entity is a major commitment. If circumstances change or you need to pivot, that investment and effort could be lost — and you may have to navigate the complex process of dissolving the entity.
With a global HR partner you gain flexibility and avoid long-term commitments. For example, you can test a region by engaging independent contractors first; this lets you hire internationally fast and makes it straightforward to end relationships if needed. Remote’s Contractor Management platform lets you hire, onboard, and manage contractors in a straightforward and cost-effective way.
If things progress well and you begin hiring employees as you expand, you can use an employer of record (EOR) service — such as the one offered by Remote. An EOR permits you to legally employ staff overseas without enduring the time, cost, and complexities involved in setting up an entity. This lets you scale international hiring across markets quickly and compliantly. As you continue to expand globally, you can also use Remote’s localised HR, tax, benefits, and payroll expertise. That saves you the time and effort of sourcing local providers and helps ensure ongoing compliance with labour and tax laws.
We will explain how this works in more 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?
Here are several signs that it may be time to look beyond your borders:
If your domestic market is saturated and there are few opportunities left for growth, it may be sensible to consider international expansion. Ensure your business is stable and performing well at home before you branch out.
If you receive a notable volume of orders or enquiries from customers in a specific foreign market, that can point to a growth opportunity in that region.
If research shows strong demand for your offering, limited competition, or positive economic or regulatory conditions in a foreign market, this could indicate a timely opportunity to expand.
Does your business deliver a distinctive product, service, or technology that gives it an edge in a foreign market? If so, it may be worthwhile to capitalise on that advantage through international expansion.
If you can readily adapt your products or services to suit a foreign market and there is clear demand, 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 experience, infrastructure, and expertise to support you. Our leading employer of record services deliver a world-class experience for your global team — along with predictable pricing, legal protections, and peace of mind for your business.
There are many reasons why going global could suit your business, including:
Talent acquisition
One major benefit of international expansion is the ability to tap into new talent pools.
Hiring overseas staff gives you access to fresh skills and perspectives, and enhances diversity and inclusion. A notable McKinsey study found that diverse teams are 33% more likely to outperform peers.
Hiring internationally 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, giving you access to a wider audience and building trust and familiarity. That leads to stronger brand recognition and, ultimately, revenue growth.
Happier employees
When you employ people across the globe, team members often appreciate the remote model and associated benefits. In our 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 kind of engagement improves retention and makes your organisation more dynamic. In our 2023 Remote Workforce Report, 72% of companies reported increased productivity after adopting a remote, globally distributed workforce model.
Increased revenue
As noted, expanding internationally opens access to new markets and customer segments, unlocking additional revenue. It can help you outperform peers: businesses that expand across borders generate an extra 1.9% in annual shareholder returns versus competitors that do not expand.
McKinsey also notes that companies already growing strongly at home can gain an additional 2.6% in annual returns from international expansion.
Potential cost savings
Alongside higher revenue, international expansion can offer cost savings. For instance, entering a market where resource, material, or salary costs are lower can be advantageous.
Localised insight
Expanding into a new market requires genuine local insight. Without it, you risk alienating — or even offending — local audiences and partners through avoidable communication errors or deeper cultural mismatches. Alternatively, unfamiliarity with local business practices can waste precious time and money.
Hiring people who are on the ground and culturally knowledgeable helps you avoid those pitfalls. Whether you engage consultants on a contracting basis or appoint a permanent employee to lead, 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 before competitors is an effective way to establish brand recognition and credibility. Being first can deliver a substantial competitive edge in your sector.
Even small or mid-sized businesses can make a major impact if their product or service fits the market well.
Market protection
A global footprint lets you leverage differing market trends and customer preferences, diversify revenue streams, and reduce exposure to localised shocks.
Expanding into multiple markets also cushions the effect of downturns in any single country. If a recession hits one market, performance elsewhere can offset the impact.
This approach helps preserve overall business stability during macro-economic turbulence.
Customer support coverage
If you have a substantial customer base in a region or users who speak a particular language, expanding lets you support them more effectively.
You can recruit customer support specialists who understand local language and culture, ensuring smoother interactions for both customers and your team. This is a scalable model, enabling dedicated local CS experts in each country you operate in.
Strategic partnerships and collaborations
Operating globally gives you a platform to form strategic international partnerships and collaborations that would otherwise be out of reach.
Such relationships can spur innovation, open new markets, and improve efficiency through shared knowledge and technology transfer.
What are the challenges of international expansion?
International expansion brings many advantages but is rarely straightforward. Even in favourable conditions, success is not guaranteed — regardless of industry or company size.
The data highlights this: companies expanding abroad can see a return on assets (ROA) of -1% for up to five years, with only 40% surpassing a ROA of 3% or more.
That is why recognising common pitfalls of global growth — and knowing how to mitigate them — is essential. Below are some of the main challenges you may encounter.
Local legislation and regulations
Failing to follow local labour and tax laws can result in fines, legal action, and even restrictions on trading. This is challenging enough at home, but untangling foreign legal systems can be complex, time-consuming, and frustrating — especially when rules change frequently.
That is why working with an experienced global HR partner is strongly advisable. Remote helps ensure compliance with labour and tax laws wherever you hire, so you can concentrate on running and growing your business.
“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
Check out our Country Explorer tool to see all currently available countries and roadmaps.
Market differences
Many companies err by simply duplicating what worked at home. Entering foreign markets requires a deeper grasp of local dynamics, consumer tastes, and cultural subtleties.
For example, numerous fintech firms are expanding internationally and are frequently focused on engineering and product development.
However, they may lack experience planning cross-border go-to-market (GTM) strategies or understanding which campaigns, channels, and messages will resonate. That is why it is important to hire the right people who have strong knowledge of your new market.
Cultural differences
Cultural differences affect communication styles, negotiation methods, and employee management. A lack of cross-cultural awareness can lead to misunderstandings, strained relationships, and potential failure.
Again, hiring local employees is advisable. They possess deep knowledge of their culture and customs and can offer valuable — sometimes game-changing — insight. Local hires also bring networks that ease navigation of the local business environment.
Competition in foreign markets
Foreign markets can be intensely competitive, with local and international players contending for share. Knowing the competitive landscape and differentiating your offer is critical.
Global competition has accelerated in recent years, making a clear competitive strategy essential when expanding internationally.
Time and money
International expansion often requires significant upfront investment, including:
Legal and regulatory compliance
Establishing local operations
Developing distribution networks
Additionally, you may need to invest time and funds into building partnerships and recruiting and training a local workforce.
These costs add up. For example, forming legal entities can take up to 12 months and cost over $100,000 per location, depending on local requirements and ongoing administration.
To sidestep much of this, consider partnering with an expansion specialist like Remote. With our EOR services, you can employ people in many countries without creating a single entity — and be operational in days.
To learn more about how an EOR works, see our in-depth guide.
Logistical issues
Depending on your offering, logistics — such as transport, supply-chain management, and customs — can be major barriers. Moving goods and resources across borders requires careful planning and coordination to maintain efficiency.
To reach customers reliably, you need an effective distribution network and resilient infrastructure.
Banking and currencies
International expansion typically entails multiple currencies, banking systems, and financial regulations. You must manage foreign-exchange risk, build banking relationships, and navigate international payment systems.
You also need to determine 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 often complex and vary by country, affecting how you store and manage information across borders.
Consequently, staying aware of current data regulations is crucial to minimise 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 you enter new markets, you must safeguard your products, ideas, and branding. Securing patents, trademarks, and copyrights (where applicable) is essential for protecting your IP.
You should also have measures to prevent IP theft or copying, in line with local laws. If legal disputes arise during expansion, you will need to know how to address them in local jurisdictions.
Remote can help you protect your IP when working with employees and contractors abroad.
Cybersecurity breaches
Cybersecurity and data breaches are widespread, and their impact can be severe. IBM reports that 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 difficult, especially when expanding internationally. Different regions have varying data-protection rules, and you must keep pace with them all.
Transferring data across borders carries risk, and securing remote employees and their devices is challenging. Home workers may use personal devices, which increases vulnerability.
Therefore, ensure employees are trained in safe online practices and use current tools and methods to keep your cyber defences robust.
If you choose a global HR partner, verify their security standards. Remote, for example, uses enterprise-grade data protection and security protocols and has 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 a practical expansion plan look like?
As covered earlier, expansion is more than placing a flag in new territory. It involves understanding varied markets, leveraging local relationships, and navigating cultural and regulatory subtleties.
Below is an outline of suggested steps and how Remote can assist at each stage.
Start by taking the time to thoroughly understand the dynamics of your target territory. Analyse data, conduct assessments, and build a clear picture of local consumer behaviour and preferences.
Explore market trends and identify where growth potential lies for your company. Take macro-economic and demographic factors into account.
Be alert to barriers to entry such as cultural differences, language challenges, and regulatory limits. Recognising these beforehand lets you find solutions — or reassess whether entering that market is advisable. Identifying your mode of entry Decide how you will enter the market, weighing available resources and your risk tolerance. Each entry method — exporting, licensing, merging, or direct investment — has its own pros and cons, so it comes down to your risk/reward preferences.
For instance, exporting can be relatively low risk but may give you less control locally. Licensing can provide fast market access but bring quality-control or brand-reputation risks. Ensure you formally document your plan as well.
After research and choosing an entry approach, build an expansion plan. This should act as a roadmap and cover areas such as:
Financial plan : Factor in your budget for market entry and ongoing operational costs. Account for currency exchange and potential financing that might affect capital structure and cash flow.
Set realistic revenue and profit forecasts based on your market research and plan for multiple scenarios — positive and negative.
Risk assessment: International business involves risks from political instability and economic volatility to cultural differences and regulatory compliance. Conduct a thorough risk assessment to evaluate the likelihood and impact of each risk on operations, finances, and reputation.
Once risks are identified, develop mitigation and management strategies. Contingency plans enable operations to continue or recover quickly. With robust risk management, your expansion strategy will be resilient, flexible, and adaptable.
Infrastructure and logistics plan: Depending on your business, consider infrastructure and logistics needs, covering both physical and digital elements.
This may include planning your entire supply-chain process — logistics and transport — to ensure smooth operations for all stakeholders.
This stage focuses on market-entry preparation and may include:
Finalising and securing any required funding
Preparing your digital (and/or physical) infrastructure
Crucially, understand the legal and regulatory obligations of your target market to avoid fines, penalties, and reputational harm. This includes employment legislation, IP rules, tax and accounting duties, and entity-formation requirements.
You can hire local lawyers and tax advisers, but that requires time and money. Working with an EOR like Remote is quicker and more cost-effective, as we handle much of the legal work at a fraction of the cost.
This enables you to begin hiring the people who will drive your expansion within days.
In this phase you establish a tangible presence in the new market. That may involve opening a local office or hiring local staff and ensuring the on-ground resources needed for effective operations.
You will also deploy your marketing plan to build brand awareness and attract customers.
Once established, the emphasis shifts to scaling operations and growing your customer base. Expect an ongoing cycle of marketing, acquisition, and retention. This period often brings rapid activity and a focus on performance metrics and return on investment (ROI).
At this stage your business will have an established market presence. The focus becomes continuous improvement of operations and refining products or services 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 most critical factor determining 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 can be difficult. You must understand 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 worry. Our all-in-one platform supports every phase, allowing you to concentrate on the core business. Here’s how it works:
Recruitment
The first task is finding the right people. Use local job boards, social networks, and referrals to help in the search.
You can also use Remote Talent to help fill hard-to-fill roles, with our remote jobs board opening access to global candidates.
Using our EOR, you can also offer the best local benefits, which helps attract top talent.
Hiring
After selecting a candidate and making an offer, you can hire them quickly through our EOR service or, for contractors, via our Contractor Management service.
This is especially valuable in a new market, allowing you to “test the waters” with contractors before committing fully. You can convert contractors to employees easily 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 of a new hire’s lifecycle. If the experience is poor, the hire may question their choice and you risk losing them.
When you hire through Remote’s EOR, the new team member receives a warm, personalised welcome and step-by-step guidance through onboarding. We make the process quick, simple, and compliant, and assign each new hire their own HR manager.
This applies to contractors as well. We ensure full compliance and provide consistent 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 fast. No matter where your workforce is based, Remote makes payroll straightforward and lets you run payroll in minutes.
If you use our EOR service, payroll is built into the process — we do calculations, deduct required taxes, and pay your team on time. We also provide in-house support for payroll queries. Learn more about EOR payroll management.
If you choose to open your own legal entity in the 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 multiple currencies. Learn more about paying independent contractors.
Managing team members
Managing daily HR for your international team is simple with Remote. We provide a fully free HRIS, letting you consolidate HR tools and manage everything in one place. Employees can also self-serve HR tasks like time and attendance, expense claims, 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 that growth is unrestricted; our platform and services scale with you worldwide. As you grow and enter new countries, there is no need to change providers or remodel processes — a common limitation with smaller local vendors.
From recruiting and hiring to onboarding, payroll, and management, we can handle every aspect of your global HR, from your first hire to your 1,000th — and beyond.
Examples of successful international expansion
Remote has supported companies of all types to expand across borders, including the following:
Loom
Loom, a major video communications platform, used Remote’s global infrastructure to expand its team into several new countries.
With an extraordinary 900% year-over-year growth in 2021, Loom relied on a global talent pool to meet demand, but international hiring brought many complications.
With 15 people across 11 countries, Loom’s HR team struggled to manage local hiring rules. Building international hubs and dedicated management was not feasible.
Remote provided coverage where Loom had international staff and entities, offering transparent and fair pricing via its EOR service. This partnership enabled Loom to convert contractors into employees, giving legitimacy and improving the experience for their 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 gained access to a diverse talent pool while ensuring compliance with local laws. This supported the company’s growth and enhanced the employee experience.
Primer
Primer, a leading fintech firm, relied on Remote’s infrastructure and expertise to manage the complexities of international hiring.
Recognising the potential of remote work, Primer was eager to tap global talent. Yet expanding across multiple countries brought its own challenges.
Partnering with Remote gave Primer the tools to hire internationally, with Remote’s EOR delivering a transparent cost model and ensuring compliance with local laws. This let Primer concentrate on what it does best: 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, offering a more consistent and improved experience for its workforce. As a result, the company expanded successfully across borders while maintaining employee satisfaction.
Read more about Primer’s story.
Seatti
Innovative tech company Seatti worked with Remote to transform its approach to global talent acquisition and management.
Like many firms, Seatti wanted to support international growth by hiring in new markets, but managing global employment was a significant obstacle.
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 and regulations, enabling successful cross-border expansion while fostering innovation and diversity.
Read more about Seatti’s story.
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Expand internationally with Remote
As shown, international expansion offers many rewards but also a wide range of challenges.
Remote’s integrated global HR solution is designed to help you overcome these challenges at every stage. We let you consolidate and grow in new markets by hiring, managing, and paying top local talent while keeping compliant with changing labour and tax laws.
Whether you want to hire one employee or contractor abroad or hundreds across multiple countries, we provide everything you need in one streamlined platform. Whenever you require assistance, our in-house, on-the-ground experts are ready 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.