Business Expansion

Business Expansion into the U.S.

To better understand how AmCham Romania can help member businesses expand internationally to the United States, research was done into how businesses typically go through this venture and what the required steps are for a successful expansion. In addition to delving into how companies can expand, research was also done on specific rules and regulations put forth by both state and federal United States law since any business growing into the United States will be required to abide by those laws.

Possibly the most important step to any business expansion is initial market and location research. The information gathered on these topics can be highly variable between industry, business structure/size, and personal preference.

Below are some of the key considerations that Foothold America, a company which specializes in helping foreign businesses expand to the United States, recommend.

  1. Make sure that there is significant demand for their product or service at a price that they can provide it while maintaining profits.

    • Information regarding product demands will help to identify competitors

      • Aids in developing ideas of how to best create a unique corporate image and experience

  2. Assess the present market circumstances by staying up to date on local and national economic and political situations

    • Businesses can identify whether the current timing would be optimal for a venture or if it might benefit them to wait

    • Businesses have to first find a location

      • Pinpointing a location can be extremely variable between each business since prime location depends on many factors such as "proximity to your target market and suppliers, local infrastructure, geography, climate and tax rates”

  3. Understand the importance of finding a US attorney, international tax consultant, and accountant who understands U.S. taxation records.

    • These consultants or employees can provide valuable advice and work to complete required paperwork for an expansion

Clayton & McKervey has some more specific fiscal advice on their website, going into more depth than Foothold America on how to plan for employment in the U.S. as an added cost. The article discusses entity structure, U.S. Tax Identification Number, and reporting requirements. Entity structure is vital since the choice of structure determines how a company is taxed. A U.S. Tax Identification Number has to be gotten from the IRS before opening any bank accounts or setting up payrolls. Reporting requirements in the U.S. are relevant for any acquisitions, establishments, expansions, ownership, and payments the company may make.

Rules and Regulations

The scope of the project focuses on policies that would affect international businesses that are looking to expand into the United States, specifically into the Worcester and Boston areas. When looking to expand foreign businesses into the United States, special attention is needed to understand US federal, regional, and local policies as well as the rules and regulations of the home country of the business. In the case of a Romanian-based business looking to expand into the greater Boston and Worcester area of Massachusetts, the federal regulations of foreign businesses entering the US market need to be understood. In addition to the federal laws, there are also rules and guidelines that must be abided by on a more local level. For instance, all states have their own set of rules and regulations regarding business practices. For instance, all states have their own set of rules and regulations regarding business practices.

In the US, businesses are principally found in the forms of corporations, limited liability companies (LLC), partnerships, limited partnerships, and branches (Clayton & McKervey, 2015). Depending on the type of business entering the market, there are various ownership rules, liability, taxes and filing requirements.