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Expanding your business into Europe


Europe has always been considered a great region for companies looking to expand their businesses internationally. Expanding your business into Europe brings many opportunities to grow outside your home market. However, expanding into Europe is not without its challenges. In this post, we look at the key factors businesses need to consider before expanding into Europe as well as the advantages and pitfalls to look out for.


When considering the possibilities of expanding into Europe, do not go in blind. Research is vital and understanding how the European market works is key to a successful business expansion abroad.

Some key factors to consider when deciding to expand your business into Europe include:

  • How much to invest?
  • What are the costs and time frames needed to set up a foreign entity?
  • How to manage compliance, taxation, and immigration regulations in a new country?
  • Who to hire to organize local payroll and international employment regulation?
  • What is the process of shutting down a foreign entity, and how long does it take?

Once you have researched the region, it is important to know the advantages and the pitfalls to watch out for.

Advantages of expanding your business into Europe

1. Plenty of Opportunities

Europe is a vast ever-growing region and a great hotspot for companies looking to expand globally. Europe provides opportunities for businesses that are looking to expand into an emerging market or an established market. Whether a business is interested in expanding into Northern, Eastern, or Central Europe, the European market has lots to offer.

A strong stable environment, well-educated talent, and easy access are reasons why companies expand into European Markets. Continental European markets are always favorable as is the English-speaking countries of UK, Ireland, Scandinavia, and the Netherlands.

In addition, gaining access to the European single market is very advantageous for global businesses. Once a business has set up in an EU country, they have easy access to the other 27 member states some of which are the wealthiest countries in the world.

2. Access to an educated workforce

Some companies make the mistake of delaying their international expansion plans until they find someone in-house with international experience. However, this is not necessary as Europe is home to a highly talented skilled workforce. By tapping into the local talent market in Europe, companies can expand their business quicker. Hiring a local worker who knows the European market and the culture well can help establish business growth quicker.

3. Large customer market

Another advantage of expanding into Europe is having easy access to the EU single market. The European Union (EU) covers a large area of Europe and has a large population. Once a business is established in one EU country, they have access to the other EU member states. Countries that are part of the EU allow free movement of goods, services, and people as well as co-operation across other EU member states. This means that businesses have freedom of movement of goods and services to potentially 500 million customers in Europe.

Potential pitfalls to watch out for when expanding into Europe

  1. Costs to set up

Whether you are planning a long-term expansion or just testing a market you need to factor in both setting up and shutting down costs when expanding into Europe. Building infrastructure, setting up a business entity, and paying local workers can be very costly and time-consuming. In Europe, each country’s government operates differently. Therefore, to work legally and compliantly, a business will need to hire lawyers, local tax accountants, and international HR experts. In addition, there are ongoing costs required to keep running the business successfully.

If plans do not work out, you may want to shut the operation down. In some countries, closing operations can be expensive and may take a long time —sometimes up to two years depending on the country.

  • Compliance Risk

When expanding into a new market, a business must adapt and operate accordingly to the country’s regulations. These regulations may be very different from your home country. In Europe, each country has its own rules and regulations when it comes to employment law. Therefore, it is important to partner with the right people who will help you to remain compliant and ensure the correct business procedures are in place from day one.

  • Managing International employees

Every country in Europe has its own rules in relation when it comes to employment laws. While some EU countries have similarities in certain European laws, each country operates these directives differently and in line with their own country’s laws. Hiring international employees requires a new level of HR support and administration. Staying compliant is vital to successful global expansion in Europe. Failure to remain compliant can lead to serious costs. By hiring an international HR expert will ensure your workers are legal and compliant to work in a new country.

Final Thoughts

Expanding internationally has its pros and cons. However, companies looking to expand their business globally can avail of the many benefits Europe has to offer. With over 500 million inhabitants, a diverse group of countries, and a single market, Europe offers businesses plenty of opportunity for expansion.

Once you know where you want to expand and who you want to hire, we can do the rest.

Fill in our quiz below to find out how you can expand into Europe!

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