By Deborah Longbottom, Chief Finance Officer, Elmwood
With five studios across the world, Elmwood has a global presence that enables us to be ahead of the curve when it comes to spotting new ideas and emerging trends.
There are many positives to expanding overseas – from an enhanced client perception of your business, to servicing clients more efficiently – but opening a studio in another market is not a venture to be undertaken on a whim.
Before you dive in, it’s really important to understand how this is aligned to strategy and why you need to be in a different market, because it’s going to take an awful lot of energy, time and money. If it’s not thought through and well managed, a venture like this can have a detrimental effect on your whole business.
But back to the positives! Opening an overseas studio can be extremely motivating and when it’s done right, clients will really embrace it too. Here’s my advice to get it right from the outset:
Partners and advisors
You’re going to need them! This isn’t something you can do on your own. From lawyers to tax advisors, insurance providers to recruitment consultants, you’ll need to work with partners that either have an international network or local knowledge of the market place. And don’t forget to explore what support the Department for International Trade can offer you too.
This band of advisors is going to be essential to your success, helping you work compliantly and gain a level of understanding of the market from a pure business perspective. They can also help you explore and answer these three vital questions:
What’s the right way to enter that market? Is it opening a studio, having a consultant in the market or even an agent? What is the right thing for your business?
What’s the financial risk? How are you going to fund this? It can be expensive and you need to be really sure you either have the free cash flow to do this or have sufficient working capital in place.
Are you competitive in the market? You might already have clients you are servicing there, but are you actually competitive in that market?
Staffing your studio
Once you’ve settled on opening a studio, you need to decide who’s going to work there. Will you be seconding people out there from your UK team, hiring locally, or a mix of both?
If you want to translate your agency’s culture to the overseas studio, then I’d recommend seconding staff out there to help locally hired staff understand how you do things. This will also help ensure your service and quality levels overseas are aligned to your UK enterprise.
From an employee’s perspective seconding can be really motivating too – they get to see the world and experience different cultures and clients, with all the positives that brings. Whilst the people you are hiring locally will understand the nuances of the market in a way you won’t ever be able to. It’s really important to truly embrace that – they will enrich your business as a result.
Your partnerships with lawyers will be invaluable in terms of immigration issues, local regulations, employment contracts etc. Every market is different so make sure you know what you need to provide – contracts in the US for example are very different to the UK, and health cover there is very complex.
When it comes to things like holiday allowance, if you can apply as much consistency as is practically, commercially and culturally possible across the whole business then that’s useful. But it’s best to explore what the comp package looks like in its entirety for each studio, because ultimately every market is different.
And finally, never underestimate:
How long things can take when it comes to arrange your banking requirements.
The difference between the cultures and how things are done: don’t assume that how we do things in the UK are the norm even if we speak the same language.
The amount of time this takes from your team in the UK. I’ve had many conversations at 2am about setting up property leases in a different country. Try and understand the implications at home as well as abroad. This is a time consuming exercise, because ultimately that’s the way to make it successful.
After cutting her financial teeth at Coopers and Lybrand, then working as Company Accountant at a Rubber Compounding company, Debbie became a financial consultant for a number of years, before joining Elmwood in 1997. As a Fellow of the Chartered Management Accountants Association her role as Chief Finance Officer includes strategic planning, financial control, cash and account management, commercial contracts, company secretarial duties, investment and risk management.