The current moment would certainly be an “interesting” one to launch a business in the United States. However, putting to one side whatever your perspective may be on the recently installed “Trump 2.0” administration, it is not – and never has been – the “work of a moment” to put in place business roots in the US.
As exciting and lucrative an entrepreneurial destination as this North American country can be, you will need to be well-prepared to deal with the sophistication and complexities of its business environment.
So, to help ensure a slightly smoother journey if you have ambitions as a foreign national to become active in business stateside, here are a few common mistakes and oversights our team at Aspirock would urge you to avoid.
Not doing enough research into the US business landscape
It might seem like obvious advice to suggest you need to research a particular business jurisdiction thoroughly before you become directly involved.
However, it is worth underscoring the importance of this step in the case of the US. If, for example, you are looking to expand a business presence into the US from another predominantly English-speaking country such as the UK, you may easily underestimate the sometimes-vast differences in business culture and operations.
The US may vary markedly from your country of origin when it comes to such cultural and regulatory factors as employment contracts, work breaks, holiday entitlements, health benefits, and communication styles.
So, how can you begin to undertake such research? It can certainly be worthwhile to speak to key people at companies in your home country that have successfully planted business roots in the US. They will hopefully be able to share with you their first-hand experience, perhaps drawing attention to best practices they wish they had followed earlier.
It will also likely be insightful to conduct in-person visits to relevant business conferences in the US. This advice applies particularly strongly if you can find conferences or workshops that provide advice and guidance specifically about overseas business expansion into the US.
Selecting a business structure that doesn’t suit your needs
One of the reasons for prior research being so important, is because one of the first decisions you will need to make about your fledgling business presence in the US, will be among the most critical. We are, of course, referring to the business structure that you choose.
There are certainly many different structures that someone can pick from for a business in the US, such as a limited liability company (LLC), sole proprietorship, partnership, or corporation.
As a non-resident, you may be inclined to choose whatever structure seems most common for similar businesses in your industry. But different business structures can bring greatly different implications with regard to such factors as liability protection, administrative requirements, and taxation.
Whatever USA business structure you ultimately do decide on, you will therefore need to ensure it is a good match for your business ambitions, the amount of control you wish to have, and however much paperwork you can comfortably handle. Discussing these factors with a legal expert will help you arrive at the optimal decision.
Failing to plan for future expansion of your business
We referenced “your business ambitions” above, so let’s elaborate on that topic. Such is the level of challenge involved in simply launching a business in the US, you might (relatively understandably) focus to such a great extent on immediate and urgent needs, that you don’t adequately plan for your company’s future growth.
Often, a fundamental bar to growth is the business structure that was chosen. A sole proprietorship or a poorly structured LLC may not offer the opportunities you require over the years to come as far as attracting investors or raising capital is concerned.
Your tax responsibilities, too, will change as your US company grows, with potential implications for your profitability. So, this is something else you will need to inform yourself about, long before you reach that stage of your business’s expansion.
We’re well-placed to provide tailored payroll support to your business
Here at Aspirock, our USA payroll services and associated expertise in matters such as taxes, social security obligations, and workers’ compensation, can help relieve your burden as you plot the launch and growth of your business stateside.
To find out more about how we can assist you as your favored Employer of Record (EOR) in the United States, please contact our team.