Tax competition among countries

Tax competition among countries


There are a few different considerations that businesses consider before expanding into outside countries.

The first of course is, what does that country’s marketplace look like for their given product or similar products? If there is no current market for this product, could there be one or is there a reason no market exists? Maybe this culture has no use for the widget your company is looking to export. If there is a market, what does the competition look like? How many existing firms are in the area? What do their products look like? What are the barriers to entry for new businesses?

One of the primary barriers to entry for businesses looking to expand to outside countries is any given country’s tax code.

Tax codes can be extremely uncompetitive or extremely competitive and they can be a major influencer for whether or not a business will expand in your territory. For example, let’s take the case of Germany because that is where I first started my marketing ventures. If a business is looking to expand into the Germany marketplace but Germany’s taxing and business climate is very unfriendly towards new businesses, the firm may opt to build their new research center in Austria instead. They have similar enough clientele and it would be much easier to get into the German marketplace from Austria than it would be from the United States. So, in effect, Germany will now have access to the all of the good that will be produced by the company looking to expand but none of the jobs relating to those goods.

This problem becomes especially evident in countries like the United States that are broken into 50 state territories that are all sovereign political entities under the umbrella of one federal government. States must enforce federal laws, but they can choose to go further in the case of taxation. What you now find in America is a massive migration of both the populace and businesses into the states with lower tax rates. States like California are losing residents to states like Texas that are quickly becoming the giant technology leaders.

The best thing that countries and states can do to avoid this type of mass migration exodus is to make their tax rates competitive with their neighbors. If you keep your tax rate competitive and do not allow yourself to have artificially high tax rates relative to the country’s surrounding you, you will be able to attract more businesses looking to expand. One option that shouldn’t be pursued, however, is cutting special deals with select businesses. This discourages other businesses from entering the marketplace because they are unable to get these same deals. It also adds to the level of uncertainty in the marketplace where businesses cannot be certain if tax rates on their company or industry will remain steady. Businesses generally look for predictability in a business climate because it allows them to develop strategies for their own expansion.

So the important take away from this is to remember when looking to expand your business into foreign markets, take a look at the business climate in those countries. Even if you want to get into marketplace “A,” opting to set up operations in marketplace “B” is sometimes the better alternative.

My Background in Communications

My Background in Communications


I use this blog to talk a lot about topics relating to business marketing and viral business marketing, specifically for those businesses looking to expand into international markets. But today I thought I would go into a little more depth about my own experience in communications and marketing, aside from what is said in the about section of the blog.

I studied business and business marketing at the University of Amsterdam, graduating in 2007. Shortly after graduating I got a job in the marketing and public affairs department of a medium sized Amsterdam business looking to expand their operations in Germany and England. Since this was my first job out of college, I gained a lot of experience on how to craft messages relating to specific target audiences. It also helped me experience marketing to foreign clients. English and German cultures are different than we have in Amsterdam, so all of these differences need to be taken into account when setting up a marketing campaign.

During my time at this company, I produced a number of short YouTube promotional videos that were marketed online and aired on certain English and German television networks. Narrated adaptations were aired on the radio also, but the primary venue for all of my projects were in the digital realm. From my experiences working with these online projects for this company, I was able to hone my abilities in digital marketing with exacting precision.

I worked at this company for four years until a new opportunity arose where I could expand my international expertise into U.S. markets for international technology companies looking to expand their presence in Europe.

When I started with the company I current work for I was able to offer them a service that no other person in my field could offer. I had the experience of working for four full years with a company in Amsterdam whose purpose was to expand in England and Germany. This means that I had extensive knowledge of Amsterdam, German, and English markets, all key areas for technological innovations. In other words, I was a no brainer for this company. This new job was a great opportunity for me because it gave me a whole new exposure to the biggest market in the world, the United States market, which has really helped me develop some sound connections.

Now I work with many of the same types of projects as I did at my old job with a new focus. I also moved stateside to the state of California, the hub of technological innovation in America.

My advice for all of those who are looking to go into business and business marketing: make the most out of every job opportunity that you are given. Never underestimate the skills and connections you will be able to make at a given location. Through my first job I was able to capitalize on my Amsterdam background and expand it to surround European countries. If I hadn’t gotten all that I could from this experience, I might not have gotten my current job, which has paid off in leaps and bounds as far as developing my skill set goes.

The Need for an International Appeal

The Need for an International Appeal


Companies all across the globe are looking for ways to broaden their appeal and becoming internationally recognized. In this post we’ll go over a brief history of why companies are choosing now to go international and a few of the challenges that they face along the way.

Ever since the 1980s and 1990s countries across the globe have discovered that free and open trade is beneficial for their economies, both in the importation and exportation of goods, so companies now have most of the historical boundaries that separated neighboring countries from trading with one another removed.

In years past, companies shipping goods from the United States to Mexico faced stiff tariffs, but with the North American Free Trade Agreement this is no longer the case. Companies are much more free to set up and sell goods in other countries than they were in years prior. U.S. car companies for example are much more free to set up factories in Mexico, providing the Mexican economy with less expensive cars. This has opened up new markets for business around the world and they are looking for ways to expand.

The Internet has also played a vital role in the importance of international business. Now people log onto the Internet every day from all across the globe and can access and buy your products with the simple click of a button. In years past, they might have to send a letter, call overseas, or even fly to your country in person to get a product ordered, but today it is incredibly simple. Lifting many of these trade restrictions along with the success of the Internet have served to make the world a much smaller place.

Unfortunately, many localized companies lack the knowledge, ability, and resources to set up a successful international campaign or a new branch of their business. There is a lot of unique, cultural specific knowledge that must go on while trying to enter foreign markets with your products. Think about how long it took your business to grow locally and nationally. Why would you assume it should be so easy to appeal to an international audience then?

This is precisely what I do at my job. I help companies that are looking to develop their localized or nationalized brand into a worldwide, international brand. For some companies this is easier than for others by the nature of their product, but companies across the board are now looking to do this.

It is also important while seeking to develop an international identity that you maintain your national one. Think about it this way, your company is trying to break into foreign markets, correct? Well it would be only natural to assume that foreign companies are trying to do the same thing. This means that outside companies are actively seeking out the best ways possible to compete with your business. This is why it is so vitally important that you maintain your localized brand while you do your international outreach because losing your customer base is simply not an option.