New research released by Globalization Partners and CFO Research indicates that most businesses are undeterred by the impact of COVID-19 and are still moving forward with plans for new
or expanded international operations. Many are looking at the Asia-Pacific region as a priority for their expansion
plans.
More than half of the respondents expressed interest in expanding or adding operations in the Asia-Pacific region. The
findings also show that 83% of respondents said they are looking into a remote, global workforce model as a solution to
the changes brought about by COVID-19.
Despite the pandemic-induced economic crisis, 45% of respondents are either currently expanding globally or only
slightly delaying their expansion and will do it within one year. Another 9% maintain intent to expand internationally
but remain in a year-long holding pattern.
After North America at 71%, the Asia-Pacific region (excluding China), targeted by 65%, was the most popular region for
new or expanded operations. Capturing market share was the top cited reason for expansion into these specific regions.
Also, highly cited was the desire to expand sales, diversify investments and acquire top talent.
“This research offers grounds for optimism that the economic crisis caused by COVID-19 has not derailed international
expansion plans for most businesses who were already on this path,” explained Nicole Sahin, CEO and Founder of Globalization Partners. “However, the operational challenges, particularly around local legal rules, recruitment and compliance can take
months to navigate. Our solution removes these barriers to success and makes it easy to establish new international
teams and revenue generation in a matter of days.”
The data also found that employee health and safety was a top concern related to global expansion, cited nearly twice as
much as the other leading issues, including new business strategies, increasing sales pipeline and revenue, and reducing
organizational costs. In addition, 83% of executives expressed concern managing multiple third parties and stakeholders
in a foreign environment during a volatile economic climate. And 74% of executives expressed concern with navigating
foreign banks and international employee payroll in these volatile times.
Expansion had been or was expected to be a long process for most of the executives. 86% said their global expansion took
or would take at least five months. That figure included 42% who put the time required at more than one year. As a
result, dedicating resources to global operations was also a top concern for executives planning international
expansion.
Sahin concluded: “The survey supports all the key challenges facing companies as they expand globally. But the biggest
issue for most of our clients is the time and cost involved with establishing legal entities or subsidiaries. We make it
easy for our clients to hire talent in a new country in a matter of days while ensuring compliance with international
laws and agreements.”Survey Methodology
The survey, conducted by CFO Research of Argyle Advisory and Research Services, polled 166 senior finance executives at
companies with international expansion plans.