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Benefits and Challenges in Expanding to APAC

Updated on :

February 20, 2024
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Benefits and Challenges in Expanding to APAC


According to most economic statistics, Asia Pacific has the biggest economic potential in the years to come. Asia Pacific's overall gross domestic product (GDP) was $31 trillion in 2020, accounting for 37% of global GDP. According to the Asian Development Bank, the region is also predicted to generate 60% of world growth by 2030.

If you’re planning to expand your business to the APAC, now’s the time. But, there still are a few hurdles that you will need to overcome. And though hiring globally is a daunting process, building teams in the APAC region is easy with Skuad.

Challenges of Global Expansion in APAC

Foreign businesses planning to operate in the Asia-Pacific region face several challenges that affect their earnings, productivity, and potential in new and developing markets. There are hurdles to entry, particularly for new enterprises in East and Southeast Asia, such as:

  • Language
  • Tradition and culture
  • Trends in the community
  • Religious views

It is necessary to undertake market research to determine why local Asia-Pacific economies are important to your company and how much time and resources you will need to invest to gain a footing.

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Benefits of Doing Business in APAC

Growing internationally is a tricky business, however, global expansion in APAC provides you a plethora of benefits. The following are just some of the advantages for your company:

  • Fresh, competent, and diverse talent
  • Market presence in a new and growing country
  • Product adaptability

Millions of qualified professionals are waiting for amazing possibilities in APAC. When you arrive at the location, your team may devise a strategy for recruiting these team members and establishing a long-term international operation. But your domestic team might not have the insights to enter a new consumer market. Opening a local legal entity, running cross-border payroll and complying with each employment law in a new country, are as tough as they sound. 

Alternatively, you can consider a flexible model for growing into APAC, one in which your organization maintains its agility. For example, Skuad enables you to launch operations in another country without the expense of setting up a permanent subsidiary. You can set up a legal presence and hire personnel without having to worry about compliance. Skuad handles all of the HR technicalities and payroll management, allowing you and your team to focus on your growth plan.

Checklist for Expanding to Asia-Pacific

Extending a firm into a new location can provide plenty of additional problems, ranging from language to culture to money. The checklist provided below lists critical elements that businesses should examine when pursuing international company development into the Asia Pacific.

Priority should be given to major markets for business expansion

The Asia Pacific region encompasses a wide range of languages, time zones, and foreign direct investment rules.

Taking use of bilateral or multilateral trade agreements between your home country and the target market is one strategy to ease your entry into this region.

The most recent Regional Comprehensive Economic Partnership (RCEP) has been signed by 15 nations in the Asia Pacific area, including Australia, China, Indonesia, Singapore, South Korea, and Thailand, and it covers 2.2 billion people or 30% of the world's population.

An Employer of Record is experienced with beneficial tax and investment treaties throughout APAC. You’ll get the support you need to identify important trade agreements that will allow you to make educated decisions about your international company's growth.

Understand the rules governing foreign investment

Foreign direct investment regulations vary greatly throughout the area, making it challenging to remain on top of compliance among countries.

Furthermore, the expense of noncompliance might hinder your aspirations for corporate development.

By outsourcing your compliance obligations to an EOR, your firm will gain a better understanding of the local regulatory landscape and map out your liabilities and compliance posture as the organization expands into new markets.

Make use of local talent

When it comes to expanding into new markets, the greatest increasing risk that global organizations face is a skills deficit, which outweighs privacy restrictions and cloud computing.

According to the research company Gartner, businesses such as financial services, manufacturing, consumer services, and hotels are concerned about this issue.

Future growth fuel

International business development into the Asia Pacific region may fuel future growth, but it needs cautious planning when establishing your operations.

The expansion of digital economies across APAC provides an unprecedented potential for forward-thinking businesses. The ASEAN rising middle-class, which is expected to number 472 million by 2030, is one of the primary forces defining Asia's fastest digital economy.

Partner with Skuad

Skuad is an Employer of Record and a well-known facilitator of market access and corporate expansion within Asia-Pacific. Skuad functions as a single Global HR and Payroll Platform using which you can effortlessly manage your international team, regardless of where you are located.

Schedule a demo with our People Ops experts to get started.

About the author

Sandeep Patel is a Content Marketing Manager and Strategist. Over the last five years, he has created and managed content for global brands and fintech startups. He is passionate about remote work and using tech for a better work-life balance.

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