Asia is home to world-class technology centers, advanced infrastructure and densely populated emerging economies. During the last three decades, Asia has boomed in technological advancements, GDP growth and labor competency outshining western countries which makes Asia one of the best destinations to expand during the post pandemic.

According to the World Economy Forum, Asia GDP growth is dominant in the world, the prediction is that by 2030 Asia will contribute to 60% of the global growth. With its sustained economic growth and stability, many business experts expect global organisations to expand into Asia in the near future.

Here are some of the countries in Asia for global expansion in 2022.

China

China has opened its economy to international trade and is now known for its dynamic banking and technology-driven private sector. International investors are allowed to set up a 100% foreign-owned company in China where foreign investment is welcome within the country for most industries. China’s new social credit system, including income tax benefits with highly available labor, make China one of the most attractive markets to expand.

Singapore

Singapore is widely recognized as a global economic hub that provides international companies with strong trading and investment opportunities. Having one of the lowest corporate rate taxes in the world, Singapore’s friendly business policies have attracted many traders and investors. Singapore had been recognized as one of the best places to do business by the annual survey of the World Bank for many years. With attractive immigration guidelines, high quality education system in place and multilingual workforce, Singapore ranks on top as one of the best places to expand.

Malaysia

Being identified as one of South East Asia’s leading economies, Malaysia is an export oriented manufacturing hub with the second highest GDP per capita in Asia. Equipped with a highly talented, multilingual workforce ranks on top in education than western countries, many sectors such as Health services, manufacturing, high-technology, and biotechnology are heavily supported by the government. Malaysia’s openness to trade along with its infrastructure has made it one of the most desired places to expand in Asia.

Thailand

With its strategic location, Thailand has become home to one of the most fastest growing economies in Asia. The economically driven market oriented nature of business welcomes foreign investment, tech development and employment. Thailand is known for cost effective labor and its economic growth and benefits offered for foreign business entities make them a good reason to consider expansion.

Hong Kong

One of the premiere business locations, Hong Kong takes pride in being one of the leading financial centres in the world. Apart from being able to set up a business with 100% ownership, they can be a share-holder or a sole owner of a Hong Kong based company. With its free trade and investment policies, simplified taxation and strategic location, Hong Kong is a truly global city and financial center for businesses.

Sri Lanka

Sri Lanka’s strategic location provides endless prospects to venture into free trade and partnership agreements with some of Asia’s trade giants. Another advantage for a company locating to Sri Lanka is the preferential trade access gained by two large regional alliances under the South Asian Free Trade Area (SAFTA) and the Asia-Pacific Trade Agreement (APTA). Sri Lanka is full of educated and competent workforce which is an added advantage.

Choosing a global PEO will make your expansion journey smooth and hassle free. A global PEO would take care of your employee payroll, labor and HR requirements while employees work for your company. Without an entity, having a global presence not being able to worry about employee and statutory related issues is a big win, but to have all these benefits it is important to select the right PEO for your organisation. A global PEO will not be just another vendor, they will ensure that your employees are paid on time, while having the same comforts and benefits as the employees who work for your company headquarters. Managing all these is crucial and that’s why you need the right partner on-board. Here’s a few questions you need to find answers for before signing up with a PEO

Who are your founders?

It is important to know and understand who the founders are and the purpose of starting the PEO. You need clarity in your answer as you are relying on them to manage your biggest asset, your employees.

Who are the investors and what role do they play in the organisation?

The global PEO needs to be sustainable in the long run, to have steady funds, in terms of capital and cash reserves. You need to be able to rely on them to know that they have the ability to pay your employees by end of the month.

What is the infrastructure of your organisation?

Understanding the infrastructure is important specially to see if they are equipped with an in-house team within location, what their technology platform is and data security, legal standards.

How many partners are deployed across the globe, what is their role?

If Payroll is being outsourced to a partner it is necessary to understand their expertise and the level of responsibility handled by the PEO towards your company.

How do you follow data security requirements?

The global PEO needs to be compliant with laws and governing data in each region they operate in and has to comply with the corporate standards.

Do you use a software to maintain our employee data?

It is important to understand how and where they store employee data and if it aligns with the corporate standards.

Any rewards, recognitions or listings by a third party recently?

Understanding if the PEO is known and recognised recently for their work, where they stand in the market among other players.

Do you have a local reach?

Understand if the PEO has a local office in the country or if they have a regional office or if they operate via partners etc.

What is your process to hire and on-board candidates?

Understand if the PEO is following a standardised process in hiring and on-boarding employees, if the company culture will be communicated effectively to an employee.

Any controls or measures used to pay teams on time?

Ideally a global PEO needs to have a 99% or higher payroll accuracy rate, and needs to pay employees irrespective if the company pays them on time or not.

When you expanded sometime back to a foreign country, it must have made complete sense to establish a local legal entity in the new country. It would have been more straightforward at that time to set up an entity as a subsidiary while directly employing people to your new company. Having the brand exposure with a physical presence in the region, entering into contracts within the country, simplifying tax obligations and arrangements are some of the benefits of directly expanding with an entity. It may have seemed like the more obvious choice at that time, but the pandemic has changed everything for corporates including expansions. 

By setting up an entity, companies look at different ways of managing operations and employees, in most cases in a more expensive way. Many companies send existing employees to the new country to manage operations on their behalf, while some look at different relationships – getting individual and independent agencies to carry out the operations. Then there are certain instances where a company would acquire a smaller company within the country or look at a joint venture which will operate on a profit share and shared control.

Many corporates are looking at cost savings, cost reductions and even shutting down foreign branches to sustain businesses in the long run. Instead of shutting down, many companies are also looking into transferring the foreign entity to a global PEO (Professional Employer Organisation). There will be a significant cost saving in transferring to a PEO while this process can be done fast, cost effectively and compliantly within days. Maintaining multiple subsidiaries will be a huge burden on the operational cost in the long run therefore global PEOs such as ExroAsia offer their low cost services for companies to maintain their global officers through a PEO.

Switching from a local entity to a renown PEO in the region will give you multiple benefits including saving thousands of costs and cutting down on your operational time. Global PEOs such as ExroAsia manages payroll, HR, recruitment and employee compliance and labor issues. While a global PEO can administer payroll at a lower cost, there will be reduced compliance cost with no requirement to engage lawyers or tax advisors as this will be managed by the PEO itself. Further all HR related tasks, employee responsibilities will be managed centrally by the PEO while the company leadership can engage in more strategic decision making.

The pandemic brought in some unforeseen challenges to many economic giants in the world. Across the globe, some predict a downturn of the economy for certain countries there are forecasts for some which are expected to bounce back. Despite economic challenges businesses must survive and carry on vigilantly. While every market got affected in some way, there are certain industries and companies who managed to see the light at the end of the tunnel by taking advantage on such industries and markets.

There are many Asian countries who has survived Covid-19 outbreak without much impact and certain countries seem to have a promising growth even through the pandemic times. While Asia sustained, Europe has bounced back with operations running as usual. One of the reasons as to why operations run smoothly, is because the outsourced services to Asia has not taken much of an adverse effect throughout the past few months. Although there are travel bans that took place during this time, it did not decrease the amount of opportunity for the Asian job market. While it was sustainable for many countries to carry on with their Asian expansions and operations, many are looking at a larger expansion while even considering few countries at once. The exit costs for these markets remain low whereas the annual maintenance costs are comparatively cheaper with low labor costs.

Companies are considering different ways of expanding instead of setting up an entity completely which takes many months with a lot of effort and a high investment. There are many methods how expansion plans can still take place despite all changes at a low cost in the post pandemic landscape. Businesses consider safer and easier options overseas without having to travel since the concept of remote working has been comfortably absorbed by many markets during this time. While setting up an entity restricts many aspects, International PEO (professional employer organisation) has been the most preferred option for many companies. While International PEO does not need the company to establish an entity, it can save the cost by around 60% with a quicker turnaround time to set operations up. They can hire people, take care of HR and other compliance and statutory requirements while making the expansion process smooth and hassle free. Since there is no permanent presence in the country, the company can opt to exit as soon as they need if they feel that the business is not viable.

Many businesses look for the right partner to expand their operations, a solution which can mitigate the risks and lets the company expand with confidence. ExroAsia has many years of experience with a team of experts on board who can support your growth journey. Drop a message if you would like to have a chat.

We have been dealing with mutations and aftermath of a Pandemic for many months now. Let’s face the reality, Covid19 is here to stay for a foreseeable time. Hindering or postponing operations can only be short term not a wise choice in long term as anyone else, we all need to accept the reality and terms of the New Normal. While there are industries and companies who got hit badly, there are organisations who thrived through the pandemic, inventing and reinventing products and services or be it internal processes. If Covid19 cannot be eradicated any time soon, and if businesses have to operate as usual, how should we handle our overseas expansions is a decision that has to be taken with careful consideration. Here are few areas to consider when making a decision whether it is the right time to go global.

Stay alert to how they manage the pandemic

Many countries faced severe consequences including developed countries like the UK and USA. Certain countries managed to curb the growth from early stage, certain countries tackled the worse stages differently. It is important to understand the resilience of the people within the country and how the government, middle class and the economy stabilizes in and out of the pandemic.

Monitor trade trends

Watch out for the countries that show an economic growth during these few months. Understand how the growth occurs whether it is an event base growth or if it is a sustainable growth. Have a few trustworthy sources to monitor these identified countries regularly to track the changes and approaches taken to manage the growth during this period.

Steady infrastructure is a must

It is extremely important to evaluate the state of infrastructure within the country and monitor the progress of plans on major infrastructure changes that might take place within the near future. Is there a good transportation system in place, ground transport and logistics to be in a state to ship goods? The state of airports, distance to travel within main cities to airports are important areas to consider.

Having the correct cost structure in place

While certain companies outsource services from other countries, some may directly invest to market products, while some companies would invest in low cost labor or production facilities. It is important to understand the cost structure that could take place with inflation and other economic conditions in long term and forecast results.

Recruit the right employees

When going global, one of the key things to focus on is global competence. Whether it is for marketing, sales or customer service; having employees who can cater to the requirements is everything. It is important to map the global competencies that is needed before hand with skill sets and look at recruiting the ideal profiles that would suit the job and company.

Interested to know more on global expansion? We are here for a chat. Inbox us to schedule a time for a quick call.

When a company hires an employee, the responsibility of all tasks of the employee including payroll, HR related tasks and legal and labor requirements must be taken up by the employer. But not all types of companies want to take up the responsibility of dealing with the liability of managing employees. This is where the solution lies in signing up with an Employer of Record (EOR).

What is an Employer of Record?

An Employer of Record is an organization which serves as an employer for tax purposes, undertaking the responsibility of the legalities and statutory requirements of the employee while managing payroll and other related tasks of the employee allowing the employee to work for their client.

Tasks managed by EOR

The Employer of Record handles many areas which include below functions:

• Processing payroll
• Filing taxes
• Handling compensation
• Issuing statutory forms for EPF and ETF
• Processing time sheets
• Creating and maintaining employment contracts
• Employee onboarding (new hire)
• Maintaining certificate of insurance
• Completing and storing legal and statutory requirements
• Doing background checks and screenings
• Offering and administering benefits
• Termination of employees

Benefits of having an Employer of Record

Using an Employer of Record saves time that is spent on manual HR and payroll related tasks especially if your business has relocated to another region. These mundane tasks take up time and energy, outsourcing these would only save time to invest on strategic input. It is cost effective, and it allows the employee to manage and follow the industry’s best practices when outsourced to experts. If your business is in multiple regions, EOR can centralise operations and manage functions smoothly. EOR can completely take care of your employees legal, statutory and payroll requirements even if you are not experienced, neither you need to spend time in learning and complying with laws and regulation in multiple countries.

However, this does not mean that the employer is not responsible for their employees, the company will be responsible for health, workplace safety and compliance where as an EOR will be responsible for employment admin related areas along with payroll compliance and tax laws.

Getting an Employer of Record for your company

As an employer, it is crucial to have your employees classified correctly, paid accurately, sand managed compliantly to avoid unnecessary lawsuits and issues. Even if you manage a global enterprise or a start-up, ExroAsia is equipped to offer an EOR solution customized for your requirements. Message us for a free consultancy session.