Things to Think About Before Moving a Business Overseas
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The pandemic has given us all far more time than we might have wanted, to reflect on our work, our leisure and what is important to us. This profound upheaval to our lives has coincided with Britain leaving the EU and the consequences of that historic change are only just starting to be felt. Exports of food and drink from Britain to the E.U. plunged by 75% in January 2021. If you run a business, the combination of Covid and Brexit may have caused you to consider relocating to somewhere where you can achieve a better work/life balance, somewhere sunnier, somewhere different. Change is necessarily disruptive, but it can also be reinvigorating. When you are moving a business, however, there is much more at stake and much more to consider.
What Are the Consequences for your Workforce?
If you are an employer a move abroad will have consequences for your U.K. employees. If there is expertise, which will be hard to replace, it may be possible to retain some staff to work remotely, but in reality, a move abroad will mean job losses for most, if not all your employees. Employment costs are likely to be cheaper in your new location, access to the skills you need, and low employment costs will be one of your considerations; the likelihood is that your U.K. workforce will all lose their jobs.
You May Lose Your Client Base
This will depend on the nature of your business, but the end of free trade may mean that you can no longer serve your U.K. clients. A move to Europe will give you access to E.U. markets but re-establishing a clientele might be a costly and time-consuming process. Doing your research thoroughly will be key to your future prosperity.
Business Grants
Many countries are working hard to attract foreign businesses and start-ups. Grants, tax breaks, ‘golden visa’ schemes and support in establishing your business are all available. Sorting through the range of incentives on offer and deciding which will be best for your business is a complex process.
Local Costs
A key incentive for moving your business abroad is the opportunity to reduce your operating costs and increase the profit margin. Access to the skilled labour you will require will be one factor, another will be the cost of office space. Portugal has been particularly successful in attracting foreign business in recent years because of these two factors. In Lisbon, 53% of the population, between the ages of 20 and 30, are STEM graduates and they can be hired for half the cost of most other European cities. London office space is the most expensive in Europe, according to Statista, the average cost of U.K. office space in 2019 was 1513 euros per square metre. In Portugal, the cost was 288 euros per square metre, so looking at office space in Lisbon might be a wise idea.
Business Laws
No move abroad should ever be considered without a thorough understanding of the country’s business laws. You need the services of a qualified, bilingual, independent legal expert to explain to you the minutiae of the legal framework within which your business would operate.
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