This week’s Ask the Expert is answered by Jon Lucas, of Hyve Managed Hosting
Ask the Expert: What do you need to consider when setting up your UK business in the US?
For many small businesses, the idea of expanding to the US represents the ultimate opportunity. It’s a huge temptation – if you can be a success in the UK, just imagine a future where you could do the same in the most affluent economy in the world.
Setting up in the US can be one of the most exciting, but intense challenges an individual or organisation will ever take on in their career. Some businesses will have the advantage of not having to re-design their services from scratch, and many technologies will translate very easily across the UK and US markets – but that won’t be the situation for everyone. It can also help massively if existing UK customers can expand with you as you establish yourself in the US.
But in practical terms, what goes on in between the two points of deciding to set up in the US and actually doing it? What’s really involved in taking the plunge and what are the big pitfalls and obvious challenges you could easily forget? There are a few areas that really stand out as important considerations.
Recognise the level of commitment required – personal and financial
Even though your business may be incredibly well-established in the UK, setting up abroad adds a whole new level of commitment. There might be a lot of long-haul travel involved, and given your existing obligations, have you got time? How will being away from home impact your personal life – especially if that hasn’t been part of your career so far?
It’s really important to set realistic financial and business goals, especially in the short term. Do you have budget in place to fully support your plans? Do you know where you want, or need, to be based? For instance, the differences in office and staff costs can vary wildly based on US geography, so make sure you understand the financial commitment involved.
Take lots of advice – formal and informal
Our shared language and cultural crossover is a huge benefit, but it’s really important not to make any assumptions that your knowledge of running a UK business will do you much good in the US, because on an administrative level, it probably won’t.
So – and this is absolutely key – do your research and get proper advice to make sure you cover the fundamentals such as visas, tax regulations, employment law, incorporating a business and the rules around setting up a bank account, for example. The list goes on, but not understanding these foundational points can delay or ruin your plans altogether. Get them right, on the other hand, and you can concentrate on making the most of the opportunity.
Getting good advice isn’t just about constantly writing cheques – use your existing network to find people who can give you a ‘been there, done it’ set of guidelines, shortcuts and ‘hacks’. It will save you some money on professional support, and by combining the two approaches you can be more confident that you’ll get things right.
Find the right people – build trust in your new team
One of the toughest challenges – at least initially – is building trust with the people you hire. For them, it’s often about building confidence in you that there’s real commitment and a good career opportunity. For you, it’s likely to be about ensuring that people will do things your way.
But this is where you need to learn quickly about cultural working differences and customer expectations. What are the norms of working life in the US in your industry? What value can you add, and how can you avoid alienating your US workforce by adopting a completely rigid ‘it’s how we do it in the UK’ mindset?
Clearly, these points represent only a few of the many challenges you’ll face along the way. But, it’s also easy to assume that they are obvious and, therefore, easy to deal with. In reality, getting planning, advice and people right from the beginning can make a huge difference to the early momentum of your US business, your stress levels, and your long-term prospects.