| International business plans require additional study | | | | change policy at their leisure. This can create an |
| compared to domestic ones. These require additional | | | | atmosphere where investment is encouraged and |
| expense and time to resolve. Here we will discuss | | | | then after all the hard work is done, they nationalize |
| four critical ones for a business plan. | | | | or repatriate the company. This is very common |
| First, we must decide on the business structure. | | | | place in third world countries and should be factored |
| Countries have favorite structures that evolve slowly. | | | | into any decision for the business plan. Too, there are |
| When considering international companies, different | | | | many other financial facets in operating internationally, |
| structures might be required. Typically, the type of | | | | such as: currency valuation and devaluation; import |
| business structure must be discussed with a business | | | | and export taxes; inflation and deflation; and world |
| consultant in the country itself. This will most often | | | | economic changes. |
| be a lawyer from that country. It's possible that a | | | | Third, we have the movement of funds. Earlier we |
| lawyer in your home country would know the laws | | | | touched on it in relation to putting capital into the |
| of another, but it's not very common. This | | | | company or moving it out. All countries have laws |
| information is critical for the correct filing of papers, | | | | related to the movement of funds. Most also track |
| company organization and other important details. As | | | | fund movements and force financial institutions to |
| we are deciding which structure to use for a foreign | | | | collect and supply information concerning funds |
| country, the decision on how to control it is also | | | | moving across international borders. Some of this has |
| important. Will the foreign company be a stand-alone? | | | | happened because of the fight against world terror, |
| Will it be a subsidiary of another company? These | | | | but most as evolved over time with the terror |
| questions can only be answered after much | | | | struggle being an excuse to collect information. These |
| consultation. The research answers will heavily | | | | laws may restrict the amount, form and the |
| influence the resulting business plan and the resulting | | | | timeliness of funds transfers. It is proper to discuss |
| company. | | | | fund acquisition in the business plan; but for an |
| Next, we must evaluate the government and legal | | | | international company, fund transfers and currency |
| environment in our home country and the new | | | | concerns must also be covered items. |
| country. Our business plan must account for and | | | | Finally, extended control of an alien company must be |
| demonstrate an understanding of challenges. It is | | | | determined and discussed in the business plan. It |
| common for countries to place severe restrictions on | | | | costs time, money and other resources to control a |
| how foreign companies are organized, operated and | | | | company far from the normal environment. People |
| owned. Some require a resident citizen to be involved | | | | must often travel there to evaluate and monitor |
| in a company, while others require varying amounts | | | | progress. Personnel must do accounting and reporting |
| of capital and social spending to operate. Too, the | | | | within the guidelines of the country where the |
| tax structure of the country may place restrictions | | | | business is located. This control and monitoring |
| on how capital flows into and out of the company | | | | function is daunting for international companies |
| and country. Also, taxes must be levied, collected | | | | because it brings together differing ideals, cultures, |
| and remitted according to laws of all the countries | | | | laws and experiences plus often there is a language |
| involved. | | | | barrier to be traversed. This leads to a challenging |
| Some countries allow capital to flow in freely but | | | | business environment. It's not one that is impossible, |
| don't allow capital to flow out. Another concern is the | | | | but it is one to be scrutinized and considered carefully |
| stability and freedom that the country enjoys. Many | | | | during the business plan development and feasibility |
| countries have whimsical or tyrannical dictators that | | | | reviews. |