Does your business operate internationally? If you answered no, have you considered it? A few years ago, Accelerant Solutions faced some ambiguity when America’s nuclear power plants partnered in a multiyear strategy, Delivering the Nuclear Promise© (DNP), to transform the industry and ensure its viability for consumers. Part of this initiative included cutting operating and maintenance (O&M) budgets by 30%, which impacted Accelerant Solutions since a lot of our services are included in these O&M budgets.
It was at this time that Accelerant Solutions set their sights on the international nuclear market, which was currently in an expansion phase. Our decision to enter this market quickly proved successful as we secured contracts for the new build in Wales, explored by GE Hitachi and Horizon Nuclear Power and the new build in the United Arab Emirates, conducted by the Emirati Nuclear Energy Corporation in Al Ruwais, Abu Dhabi. These efforts helped us to navigate the early days of DNP and allowed us to understand the customs of operating internationally.
Here are the Top 3 Lessons Learned for Accelerant Solutions:
- Know the host country laws and regulations for operating a business.
Know if your company needs a trade license or another type of registration to conduct business in the host country. For example, in the UAE, Accelerant Solutions had to open a new branch of the company, obtain a trade license and secure a physical office address to conduct business. We then hired a Local Transaction Following company to guide us through the process.
- Understand the labor laws where you are operating.
Obtain a copy of the labor laws to determine such things as:
- Official country holidays
- Paid time off
- Steps to take if you must fire someone
- End of service benefits owed upon contract termination for your employees
Verify the structure of the company you are conducting business with so that you know who is writing the checks and who is making all the decisions.
In the case of the Horizon project mentioned above, GE was a partner, but Hitachi was the parent company, which led us to realize we needed to understand Japanese business culture better. As a result, Accelerant Solutions needed to earn their trust on small projects prior to moving forward with larger ones.
The UAE project described earlier was an entirely different scenario as the nuclear plants were being built by the government. This presents a whole new level of understanding with regards to how the contracts are issued and who is paying the bills. We discovered that the operating company, Nawah Energy Company, could issue contracts, but the invoices were ultimately paid by the government through the Department of Finance (DoF). Accelerant Solutions needed to clearly understand the flow of invoices and approvals so our strategy could be adjusted as needed when invoices went unsettled.
- Understand the culture of the country you are doing business in.
Many times, laws and customs are very different to those in the United States of America. For Example, when traveling to the UAE, be aware of your actions, including words or terms you use in conversations, to ensure that they are not found offensive. This is especially important during the holy month of Ramadan or when touring religious areas. Serious penalties could result otherwise for doing something that might be legal in the US. We strongly advise anyone visiting countries outside the USA, to familiarize yourselves with local laws and customs, and respect them accordingly.
Adopting an international strategy was important to the success of Accelerant Solutions during a period of uncertainty. We needed to take the time to understand the risks, the challenges, and the rewards of such a major advancement. We recommend gaining as much knowledge as possible about the host country before you begin your expansion outside the USA. In the end, it could save a lot of time and aggravation as well as keep someone out of jail.
2 thoughts on “What You Need to Know Before Conducting Business Internationally”
Excellent advice and information. In my experience, working with partners internationally is not only a business growth opportunity but also a personal growth opportunity. I hope and trust my international partners would agree. Remote communications make the world yet smaller again, vice travel. As COVID and political pressures begin to ease, international arenas will likely reform, ripe with opportunity. Send me in coach!
Thank you, Dan. I concur with your assessment. I have been able to travel the world because of my 31 year military career and now as a business owner. The people you meet and the places you see add tremendous value to a life. We will keep you in mind for future international opportunities!