Medserv p l c : Karl Bartolo, CEO of Medserv, shares his tips for expanding overseas

Karl Bartolo, CEO of Medserv, shares his tips for expanding overseas
17/01/2019

A few considerations before expanding overseas include the following:

• Penetrate a market in a country which is not already well serviced by locals. Venture only in countries where you have a competitive edge otherwise it will be difficult to win business over the local suppliers;
• Obtain familiarity of the culture, religion, politics, traditions, weather, community values, practices especially their festivity season and most of all keep abreast with local news;
• Factor in time difference between your home country and overseas venture and evaluate whether this will impact your modus operandi;
• Obtain an understanding of the legal structure of doing business overseas, such as licenses, tax system, sanctions, health and safety rules. Compare these to your home country and bridge any gaps between the two systems. Determine whether you can manage these gaps.
• Decide on whether you will be requiring a local partner to be part of the business undertaking. This can be of great value especially if he/she supports you in obtaining a fast track understanding of the laws, regulations as well as how to go about in managing day to day business. A partner can be of great help in choosing suppliers of services to your business and reducing your operating costs structure;
• Repatriation of funds. All profits derived from an overseas joint venture need to be repatriated to the foreign shareholders. Ensure the country you are operating in allows the repatriation of funds. Also obtain an understanding of any withholding tax payable on dividends/management fees due on payment of monies;
• Hedge yourself against currency risk between the currency of your home country (head office) and the overseas country you are operating in;
• Allow yourself time to understand the market and environment you will be operating in by spending considerable time in the foreign country you intend venturing into. This includes being in country during various time of the year. This will give you an insight of when is the holiday season, which is the most productive day of the week;
• Language barrier; lost in translation. Engage someone who can carry out proper translation of your meetings with stakeholders involved in your business decisions. Wrong tenses/verbs may at time be used by your stakeholders which results in a completely different message being communicated to you, ending up agreeing to something not to your liking;
• Understand the definition of punctuality in the country you will be operating in. E.g. in one culture a meeting/social event starting at 8.00hrs means everyone turns up at the precise time, in another country a meeting commencing at 8.00hrs means that the meeting starts at around 8.00hrs;
• Appreciate distances, coming from a small island nation everything is close by. Countries are huge and distances and modes of transport need to be taken into consideration when planning your meetings;
• Last but not least respect the local culture and gain acceptance by the local community, partners and stakeholders. An entity venturing overseas solely with the intention to solely make a short-term gain/profit will be perceived negatively by the local Authorities and the local community. It will be short lived. Demonstrating and providing in country value secures your long-term presence in the overseas country one intends setting up shop.'