What happens when cost is your only consideration

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Sakthi Visakan Rajaguru
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In this day and age, when the competition is so high, it is important to make the presence of your business felt both at home and overseas. The visibility of the company is vital not only on the Google Search Engine but various geographies as well. Global expansion is a major driver for not just revenue growth but brand awareness as well.

Revenue growth from non-domestic markets usually comes faster. Adding new revenue streams can help a company bring security and stability to the organisation. While exploring within the country, an eye should always be kept on the global market as well. This will help you position yourselves better and bring versatility to your business.

One of the most important factors that businesses today take into consideration is the cost factor. And it is a very understandable thought process. You must always dip your toes to test the international waters before you dive in. That means you should be careful about your investments and spend with care.

Having said that, you must also realise that costs are not the ONLY factors that should be taken into consideration before you step into the world of global expansion.

Before we tell you why, let’s take a look at all the cost-based decisions.

Expansion costs

Expansion costs could mean anything – moving to another location, relocating abroad or purchasing new machinery. Calculate the basic costs first. Do not include operating expenses. This will help you calculate the timelines. That is important for you to evaluate when you could break-even. Profits come in later.

Projected sales

You must have a number in mind when it comes to the sales that you can expect. It should be realistic, keeping in mind the demand and supply in the market. Sometimes, expanding to meet the increased demands can bring you more costs than revenue. Calculate optimistic, at the same time, conservative sales and profits projection to understand whether an expansion makes sense (and if yes, at what scale).

Operating costs

Operating costs could sometimes be more expensive than the initial expansion expenses. This includes staff and supplies, furniture and infrastructure, rent and utilities, etc. These numbers – the overhead costs – determine your potential revenue and profits as well.


It is prudent to calculate your return on investment by subtracting your total expenses. You know your start-up expenses along with the overhead costs. The potential sales volume and gross profit can be estimated. If you can quickly pay back your initial start-up costs and make a profit after subtracting operating costs from revenues, your expansion might be justified.

Cash flow

Don’t expect to earn unless you are willing to spend. You need to extend credit while increasing expenses. Payment for your products and services will take time to come. It is necessary to determine if you can meet your cash requirements, keeping in mind your current cash as well as an available credit. The expansion would require a loan.

Other processes with respect to your business expansion

Expanding your business allows you to establish new markets and reach an entirely new customer base. This often occurs when you set up a base of operations in a new country, where there could be a great need for your products or services. This is also executed when attempting to create a more global presence.

Now that we have taken a look at how to predict the financial expenses and income during business expansion, let’s take a look at other processes that need to be executed as well.

When cost is your only consideration

You might not realise it today, but if cost is the only consideration; chances are you are losing out on various opportunities. Investment comes in time and costs. Both are critical to the success of your company. By bringing in experts, you are ensuring that you have quality in your services as well. It is not just about what you do, but how well you do it. By trying to reduce your expenses, you could be losing out on something priceless.

Future Focus Infotech

Small businesses become big through an expansion. More often than not, it is executed keeping in mind the increase in demand and efficiencies. The goal is to create new production lines for diversity and appreciation of the international markets. There is a need to bring certain functions on the table to ensure that your visibility in the global market is high. Focus on your needs and develop refined estimates with a global employment agency.

Your goal is global expansion. The idea is to make your presence felt across borders, be it by establishing your company, starting a franchise or with baby steps by sending your employees overseas in the name of secondment. Do not digress from your area of expertise, assuming that you are saving costs. By attempting to take on too many things, you might bite on more than you can chew. This could lead to more expenses, if not done right.

How can we ensure optimum utilisation of your resources?

We at Future Focus Infotech specialise in global expansion. We have established connections across the globe. We know whom to approach for what purposes. We can introduce you to new markets and help you set up base in geographies that can help you realise your potential to your fullest extent.

Ideally, price should not be your only consideration during global expansion, because you might never know what investment could have helped you acquire your requirement. And then, we at Future Focus Infotech make sure that you get your money’s worth every time. Save focus and time; enjoy certified support from us.

How can we help?

  • With additional customers come the requirement to service a broader customer base. We will identify those logistical needs that should be augmented.
  • We help you determine the effects of the expansion on your personnel. We can allocate part-time employees through our various services such as bench loaning and secondment.
  • When it is time for full-time work, we help you with payroll for your increased personnel as well.
  • We provide just-in-time skills that help you cater to specific tasks of a bigger project. Why hire an employee whose expertise might not be required in the long run?
  • An expansion might require you to take out a loan, negotiate new vendor and supplier payment terms and to change the credit terms you offer customers and clients. Networking is key.
  • Apart from the paperwork, compliance is a high-priority matter. It will not be possible for you to know every fine print of the laws of different countries. A mishap or ignorance in the law will have serious consequences, black listing of the company and jail time not excluded. We at Future Focus Infotech stay updated on international law to ensure comprehensive care of your assets overseas.
  • We have established local partners across various geographies to assist you with settling in and getting connected to the right people at the right time.

Importance of payroll

If your business has employees, payroll will be a part of the deal. There is no way to avoid it.
Understanding the payroll requirements is vital before entering a new market. The payroll process refers to the steps taken to pay the employees each pay period. It involves a meticulous calculation of employees’ hours worked, their pay grade and rate, leave taken and subsequent deductions.

The question is, what are the elements? It can mean any or all of the following

  • It can refer to the employees being paid, along with their respective information
  • It can refer to the amount being paid to the employees during the pay period
  • It can refer to the process of calculating and distributing wages and taxes

We bring you the experience and expertise of this land. With the support of our local partners, we ensure sufficient care and attention with respect to payroll and various other policies and procedures that have to be adhered to. Hiring a Global Employment Organisation will enhance your ability to achieve success and stay updated on all the critical guidelines with respect to the payroll.

We are here to tell you that you need not expand your administrative functions or move to a larger building to take care of your overseas employees. Plan a systematic way to grow, with us as your strategic partner in the space of global employment. Connect with us now and spread your wings to expand your horizon.

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