CHAPTER VI
International Law
Starting to Think about International Business
WHEN YOU BUY GOODS these days, there’s a good chance many of the items on offer originated outside your country. Traveling abroad, you cannot avoid seeing global brands on everything. Reading or watching the news, you are struck by the ingenious ways one-person companies have found to open businesses halfway around the world to help improve people’s lives there. Advances in technology, communications and logistics have opened the global marketplace, and it seems almost everybody is in it or thinking about entering it, whether selling or buying.
It’s an exciting time to be in global business, but it can have its challenges. One of them is that each country or trade zone is governed by its own sets of regulations for conducting business, particularly when importing or exporting products. If you want to do business in another country, you must abide by its rules. Add in the mix of language, culture and geographical influences we all encounter abroad, and it’s a heady cocktail to savor.
Mike O’Keefe and I started a U.S. company a few years back that specialized in outsourcing small motors and related components, as well as large-volume lighting for hotel chains. China was known then for cheap labor in manufacturing, so we started and built our business there. We soon found out that only Chinese citizens can own businesses in China. It is a way for the Chinese government to ensure that the gross domestic product (money made in China) stays in China, in the form of Chinese taxes. We were only allowed to do business with Chinese factories and sourcing specialists in order to make our business work.
Starting out with solid facts and plans
When you start thinking about doing business outside your headquarter country, it’s best to remember a few key tips.
• Doing business abroad will be unlike doing business at home. Don’t take anything for granted.
• Read up about the target country in general, so you have a feel for current events, politics, trends and the economy, geography, history and culture, including its customs and courtesies.
• Educate yourself about your own industry sector in the target country via trade journals, online resources, your government’s commercial attachés.
• Get reliable tax advice. For instance, if you are a U.S. company, no matter where in the world you operate, you must still follow U.S. regulations regarding compliance, financial and legal obligations. You must still pay U.S. taxes, even for revenue from your offices outside the U.S., as long as you are a company incorporated within the U.S.
• With all your research complete, draw up a complete business plan and review it with a tax expert and a lawyer familiar with the target country. If your usual attorney is not versed in the area, he can recommend a qualified one.
Scoping out the target country
If you plan to send one of your employees or an official representative abroad to scout and develop business contacts, ensure you’ve done your homework on that person too.
• Will she project a professional, positive image of your company?
• Is she a flexible, resourceful, comfortable traveler?
• Does she speak languages that will be useful?
• Does she have proper travel documents, and have you checked visa requirements?
• Is she competent in her job function so she can develop contacts, interview prospects, collect information, get pricing, give specifications, etc. properly?
• Will she will behave ethically and responsibly while on the assignment? If you are a U.S. company and she commits a crime or violates any business ethics laws while overseas and you didn’t conduct your own background check on her, the U.S. Department of Justice and the Securities and Exchange Commission (never mind the target country) could hold you and your business responsible for her violation.
Going global can be very exciting, but also very confusing, challenging and downright risky. The cost of consulting with an international business attorney and tax advisor will save countless headaches and is merely a fraction of what you could pay if you get into trouble. Stay on the safe side and let experts keep you prepared and advised.
S.G.
Working Though Your International Business Plan
MANY OF THE STARTUPS or young businesses we meet with tell me they consider international business as something reserved for jet-set executives and Fortune 500 companies. However, they may be doing international business without really knowing it.
Some of the most common, yet not highly visible, examples are entrepreneurs who order products directly from international suppliers, even if it is just one component of the item they eventually sell. If it is supplied from across an international border, then you are doing international business. Or perhaps you have a retail business that offers online or catalog sales. Your consumers could be anywhere in the world, buying via the world wide web, an environment that crosses traditional international borders with a click.
Of course, there’s also the more visible global business world: the physical transportation of products, establishment of branches, set-ups with distribution partners or sales reps, ex-patriot assignments, financial transactions or even the execution of documents. No wonder there are scads of regulations in play.
Despite the fact that the international aspect of this business sounds—and is—really cool, it significantly increases the complexity and risks you face. If you see opportunity out there, you will encounter many of the other concerns discussed throughout this book, with the added layer of at least one completely different country (with perhaps significantly different jurisdiction) to also consider.
So it should come as no surprise that we emphatically recommend that you educate yourself, get reliable advice, and develop a business plan before you make any commitment to international business. By that we mean a plan for your first venture, and then separate plans for new territories as you expand.
Major considerations to address in your international business plan
Not all, but many of the factors you’ll need to think through are legal matters. Some are financial, and then there’s a whole rainbow of other things. Since in many ways these things are inseparable, we want to get you thinking in a broad, long-term mindset. Here are some of the major items to consider about potential international business.
Legal Systems If you must use your target country’s legal system, can you even do so? Will it work? Is it cost effective and reasonably transparent? Are you able to reasonably predict the outcome? Do you have qualified legal representation there? Things will be simpler in a country with a legal system similar to yours and with established professionals (lawyers or barristers) who speak your language. In contrast, doing business in a distant country, one that speaks another language and is based on tribal systems where you are expected to pay an unknown tribute amount to the local establishment for an unknown result, will demand more patience, flexibility, caution, and long-term commitment.
Political Systems What is the target country’s system of government at all levels—national, regional and local? How would they affect your business? How stable are those political systems? What roles do corruption, bribery and organized crime play? If systems are likely to change, what is the probable effect on your business? Stable systems tend to support more business, with less risk and generally lower average returns on investment (due to higher competition), as compared to many developing or recently peaceful countries that have significantly lower stability, higher risk, but also higher potential returns. There may be good news for entrepreneurs considering the latter countries: any of the international investment treaties discussed below will have significant incentives for businesses to encourage them to invest there.
Labor Standards Many companies, small and large, have outsourced various parts of their businesses overseas: manufacturing operations to China, technical support to India or documentary support to South America. The reason? Reduced labor costs and benefits like 24/7 workdays. Consider questions like these. What are the local employment requirements? What are the wage rates and what’s forecasted for them? Are these cost effective for your operations? What is the quality of the workforce population? Is there any potential for becoming involved in undesirable practices like child labor, or situations where you may attract bad business publicity for operating out of these specific countries?
Local Culture and Other Considerations Will the local culture support or threaten your business model? For example, in some cultures, copying is the highest form of praise. What impact will that have on your activity? Are there language barriers or educational barriers that would affect business? What is the local work schedule? Are there any religious, tribal or other factors that need to be considered? The examples in this category are rich and abundant, from differences in workdays, daily working hours, translated product names that have offensive meanings in local slang; plus vast cultural differences in management, hierarchy and communication methods.
Environmental Issues What are the local concerns and regulations related to the environment? If your home country’s rules are tougher, then which should you follow? What is the potential for damage from a natural disaster (earthquake, monsoon) or an environmental emergency? Are there ethical dilemmas related to locally legal but admittedly harmful practices? Waste generation and disposal, sustainable development, emissions, long-term damage and potential liability related to harm done are very real issues here. Examples of these tough issues are in every day’s news.
Infrastructure This is an area where it pays to see things first-hand if your target country is underdeveloped or starting its ascent. Are roads, utilities, communication systems and port or rail facilities reliable? Do other companies with experience in your target country have tales to tell about patchwork solutions, and are you willing to work that way? What future improvements are planned, and who’s funding them?
Import/Export Trade Regulations Some very complex considerations get involved here, and you need to evaluate them extremely carefully. Key factors include your product, country, shipping method, prices, etc. These could be affected by tariffs, quotas, trade agreements, standards regulation, regional preferences, popular opinion, etc. Your product may not sell well vs. locally made products, or import fees or taxes may make it too expensive to compete well, or it may not meet technical standards of quality or measurement. On the other hand, you could benefit from programs that give incentives to invest in the target country’s workforce training and development, or from other sorts of consideration.
Transactions Costs and Exchange Rates Transaction costs include the freight and the extra layers needed to supervise transport of supplies and products; the risk involved in potential loss, damage or delay of shipments; variation in currency exchange rates that could affect profitability; costs to meet local regulatory and accounting requirements; local tax considerations and more.
Major Tax Considerations International tax strategy and planning is a huge, complicated deal, with many Fortune 500 companies reaping significant profits as a result. Many countries, including Ireland, Bermuda, the Cayman Islands, Hong Kong and Luxembourg, among others, structure their tax codes to attract international business and investment. As your revenues increase along with your international presence, this can become a long-term strategic consideration.
At this point you probably are having second thoughts, at least about pulling together a sound business plan. Don’t feel pressed to rush through this, and do get advice from your network and your legal and tax advisors to help fill in the blanks. Doing this will reduce the number of blanks left, highlighting the remaining ones, so you can see what you’ll need to find out and weigh before you take binding decisions.
M.R.M. and S.G.
Nationalization of Businesses
NATIONALIZATION IS A CATASTROPHIC BUSINESS EVENT. It happens when a governmental agency takes possession, control and ownership of a private business interest, and may or may not include compensation for the private business. Nationalization is not just the headline-stealing take-over of an oil field by a rogue dictator; it can happen to you. You see it in developing nations as part of regime or political changes, but also quite commonly in industrialized countries. It is also known as reverse privatization.
Eminent Domain/Resumption/Expropriation This happens when private property is taken for public use. The most common form of “nationalization” is eminent domain, used for infrastructure projects like roads or high-tension wires. It is also used when changes in zoning laws require new uses for a particular property. This is an area in which you can be affected drastically, even if you are not operating internationally. New zoning ordinances can restrict the size and type of signage you use, impose obligations to make your business wheelchair accessible, or put you out of business, if for example you own a pub and the property is re-zoned to be alcohol free.
Emergency Industry Nationalization In times of war or catastrophe a government can take control of specific industries, such as airport security following the September 11 attacks in the U.S. or the railroads during World War II in a number of countries.
Corporate Control or Bailout In troubled economic times, governments may step in and prevent a company from failing by taking control of the company or making direct investments into it. This is done because the company is viewed as too critical to fail, due to the product produced or to long-term economic effects. Examples include the British nationalization of Rolls Royce in 1971, or the U.S. bailout of the airline industry.
The laws covering nationalization in industrialized countries are local to the jurisdiction. In developing nations, they could be subject to existing laws or created through political change. Nationalization, the possibility of compensation if it happens, and your rights as a business or property owner are potential major risks you must take into consideration in your business planning, wherever you are located.
M.R.M.
Treaties 101
WHAT IS A TREATY, ANYWAY? Think of it as a contract between two or more countries or international organizations. You may find related words like protocols, conventions, and pacts used instead. Treaties document agreements among the parties to do, or not to do, or to obligate themselves to either very specific points or very general guidelines.
The system of international laws that regulates cross-border business is collectively called International Commercial Law. If you plan on buying or selling goods internationally, you should know about the United Nations Convention on Contracts for the International Sale of Goods (CISG; sometimes called the Vienna Convention) and the World Trade Organization (WTO).
United Nations Convention on Contracts for the International Sale of Goods (CISG)
The CISG is the convention for the sale of goods that cross international borders. If you own a U.S. business which makes birdhouses, and you buy all of your materials from Amazon.com, eBay.com or other reputable importers, you don’t need to worry about this. Those merchants have already dealt with all applicable regulations for the materials they resell to you.
There is one thing to keep in mind with the CISG: not all countries abide by it. Because it’s a United Nations organization, only members of the United Nations honor it. If you decide to directly import from or export to another country, make sure you research that country’s regulations adequately. Generally, most countries in Africa, Asia, Europe (Eastern and Western), Latin America, and the Caribbean participate in CISG. The United Nations hosts a website fully dedicated to CISG, also known as UNCITRAL (visit uncitral.org). They provide basic facts about international trade, along with frequently asked questions. The site is currently published in six languages.
The World Trade Organization (WTO) is organized under a treaty, but it functions as more of a centralized record keeper or secretary. It supports international trade and provides a common structure for trade relations between contracting parties. The main objective of the WTO is to consider issues like tariff classifications, product nature, intended use, commercial value, price, and sustainability in order to minimize discrimination between imported and domestic products. The WTO has no actual authority to create or enforce trade agreements. All treaties are subject to change at any time by the countries that have signed them. Therefore changes in regimes, government types or controlling parties could potentially affect any trade agreements.
Here are a few more important treaties that could affect your company abroad:
• The North American Free Trade Agreement (NAFTA) creates a trading bloc between the United States, Canada and Mexico, somewhat like the European Union.
• The Kyoto Protocol is an international agreement linked to the United Nations Framework Convention on Climate Change. It sets binding international emission reduction targets.
• The Patent Law Treaty is designed to streamline, harmonize and simplify the formal requirements set by national or regional patent offices in relation to applying for and maintaining patents.
These or other treaties may have specific effects on your business model and/or profitability. You will need to do your homework and perhaps consult the appropriate professionals in relation to your business. Note: In addition to attorneys and tax advisors, there are businesses and consultants who specialize in facilitating international trade.
Protection and free trade
There is an ongoing source of conflict related to international trade agreements. The competing positions are the protection of special industries by the industrialized countries vs. support for completely free trade by the developing nations. The primary industries involved here are agriculture and new technology. The developing countries want to protect their domestic agriculture sector through subsidies and tariffs to ensure that their countries will have enough food in the event of a famine or war. The developing countries are pushing for free trade on agriculture because that is a sector in which a developing nation could immediately compete, based on available land and cheap labor.
These conflicts continue into new or high tech industries which the political decision makers view as a future source of income or power. Such industries, e.g., computers or solar power, are often heavily subsidized by governments to ensure they grow within that country, even if they are not profitable. The heavy subsidies make it impossible for developing nations to compete in these sectors.
International business is a very real possibility for many businesses, even tiny start-ups, given today’s globalized market. There is a lot to learn and consider, but by taking the time to think about it and factor it into your business plan, you will be better prepared to identify and develop opportunities in the long run.
S.G. and M.R.M.
Tariffs and Quotas and Trade, Oh My!
TO MANY ENTREPRENEURS, even those exploring international business, tariffs and quotas are subjects they skim past in the news. And in fact, their goods may not be affected by them. But it’s smart to be informed, and you may in fact be affected. So here’s your starter course.
What is a tariff?
It’s a tax or a fee placed on the import or export of goods. Today, tariffs are heavily debated in various economic theories, with the arguments focusing, as ever, on protectionism vs. free trade. Tariffs have a strong connection with various political movements and have been very controversial throughout history. Wellknown examples of tariffs include the British trade restrictions which led to the Boston Tea Party and sparked the American Revolution in the 18th Century, and the U.S.’s Smoot-Hawely Tariff Act, which significantly increased tarrifs just as the Great Depression of the 1930s was beginning. This Tariff sparked immediate retaliatory tariffs by most of the country’s trading partners and is widely believed to have significantly contributed to the severity and length of the Depression.
Since World War II, the general view of free trade has been more positive and tariffs have been steadily reduced, playing a smaller role in international business and fiscal policy. However, there are still some significant tariffs in place on items like paper clips, canned tuna, sneakers, peanuts, tires and steel.
Countries use tariffs to protect a particular industry and to raise revenue. The government may decide to protect a specific industry because it is a newly established or developing industry (in the U.S., think of renewable energy technologies); it is an inefficient but critical industry (steel, agriculture); or because foreign companies are “dumping” in the industry, meaning that the foreign companies are flooding the market with below-market-value priced products with the intention of monopolizing the industry. The added cost to an import will make it easier for domestic products to compete and the added cost to an export will make it more likely that the good is not exported to that location.
Tariffs can be charged as a percentage of value or as a flat fee based on quantity. The revenues from the tariff go directly to the government. At one time this was the largest source of income for the U.S. federal government.
What is a quota?
Quotas are another economic government control measure used primarily to protect domestic producers and industries. Quotas are set by the government and specify an exact quantity of a particular good that may be exported or imported. They are a strongly protectionist control measure and are viewed as potentially harmful to a free-market economy, as they do not allow for any competition from foreign products and result in higher prices to consumers. Quotas are also called “non-tariff trade barriers”. The history of trade quotas is very similar to that of tariffs—a popular, but controversial fiscal tool whose use has declined significantly after World War II.
There are a number of key industries in the U.S. that still have substantially limiting and controversial quotas in place. Those industries include sugar, tobacco, cotton, beef, anchovies, olives, Mandarin oranges and brooms. Other countries protect other industries, so check on their positions.
Fortunately, unless you are in a specifically regulated industry, the current tariffs and quotas should have very little effect on your business planning. If you are in one of those particular industries, then you will need to forecast any changes in trade policy in order to position your business for success.
M.R.M.
Immigration Issues
EACH COUNTRY HAS ITS OWN RULES, regulations and laws that cover immigration and related issues. These regulations will most often be at the national and international level and enforced by national-level agencies. Sometimes there are regional regulations as well.
While each jurisdiction is unique, there are some broad categories of immigration issues that especially impact businesses: illegal immigrants, asylum seekers or refugees, guest workers, and residents and tourists.
In most large countries there is a significant illegal immigrant population. Illegal immigrants are people who have entered the local region in violation of the controlling immigration laws of either the local region or their region of origin. Depending on the jurisdiction, illegal immigration may or may not actually constitute a crime. Each jurisdiction has unique standards of enforcement.
Illegal immigrants may be able to switch to a legal immigration status. Employing or doing business with illegal immigrants should be considered as a business decision after evaluating the penalties and benefits under your local laws and the market conditions. There is no universal answer.
Asylum seekers or refugees are people seeking refuge in the local region, outside of their home region or country, because of persecution, fear, war or other social upheaval. They may hope to stay short term, long term or permanently. There are international treaties and United Nations Conventions related to the definition and treatment of refugees. Generally speaking, upon arrival in the local region, the refugee must apply for asylum based on the above reasons. If the application is approved, she will be granted legal status in the local region, based on her circumstances.
Guest programs include guest workers and students. Some countries rely very heavily on guest worker programs to supplement their workforces. Guest worker programs are often controversial, as standards regarding the rights of guest workers and students while in the local region are not evenly enforced. International students and study abroad programs are also very common in our globalized world.
Guest worker status is a legal immigration designation given to foreign workers who temporarily work and live in the local region. Both the qualifications and the difficulty in acquiring this status change often and by jurisdiction. Usually guest-worker status is given to high-skill positions or to areas with an extreme shortage of available labor.
Student programs are similar in that they allow a legal immigration status for a certain period while the student participates in continuing education. If a student remains beyond the term specified, his status could change to being an illegal immigrant.
Almost all countries have immigration provisions dealing with residents and tourists. Residents are non-citizens who have been granted permission to live in the local region indefinitely. Individual jurisdictions may have ongoing requirements to seek citizenship or to contribute to the economy in some way. In countries already associated as trading partners, such as the European Union, the requirements are significantly easier.
Tourists are major economic driver and source of revenues for certain regions. Each jurisdiction will have individual requirements for documentation, length of stay, removal of goods and more. Generally speaking, tourism is encouraged but regulated.
M.R.M.
Immigration: Opportunities and Challenges
WHAT IS IMMIGRATION? It’s people moving into and settling in a non-native country or region. That movement can be international, regional or even local. Nowadays, practically all businesses have some experience with immigration and its effects on the workplace.
All over the world, immigration is an extremely complex, often controversial topic. It may be welcomed or opposed by the local population and represent dreams-come-true or nightmares for the immigrant. Immigration is a source of population growth and cultural change, but also of concern and conflict.
Factors that encourage immigration include open or porous borders, better opportunities, cheap land, rumors of instant wealth, higher pay, family reunification, better social welfare, better schools, political freedoms or religious callings. In countries generally considered to be economically open, immigrants often make up an extremely large percentage of the small-business community, perhaps because it may be easier to start a little business than to find work as an employee, or because entrepreneurial opportunity is what attracted the immigrant in the first place.
As globalization and international business shrink our planet every day, the ease with which people may move throughout the world in search of better opportunities is rising. This has caused immigration and closely related issues to be on the forefront of the political debates in most countries or regions. The exact issues vary greatly, depending on the location, but as a businessperson you should be aware of all of the political trends or pressures in all of the areas that your business operates. These political movements could include separatist movements, civil unrest, cultural conflicts, and restrictive or open immigration policies.
Looking for opportunities
People from elsewhere are very likely settling in your area now. They may come as political refugees, as workers seeking better opportunities, as invited members of a thriving ethnic community, as migrant workers, as investors, etc. They may prefer to preserve their own culture or choose to assimilate and adopt the local culture.
As immigrants interact with your business, their legal status could present both opportunities and legal issues for you, due to employment, taxation or other regulations. Seasonal immigration patterns could have significant practical effects on business as well.
Local patterns could include the development and growth of an immigrant community with a strong cultural identification. This could create or eliminate a market or source of labor and talent for your business’s services or products. You need to know the answers to questions like these:
• Are these communities growing or shrinking?
• Are they integrating with surrounding and local cultures?
• Do they bring particular assets or interests you can tap for your business’s growth?
• Are you part of this community? Can you develop connections, if not?
• Are there steps your business could take to capture this market for your goods or services, or tap its human resources for your workplace?
• Are there language differences or barriers you need to be aware of?
• Are there charitable or humanitarian things your business can do with or for the immigrants?
Often, simple small steps can make all the difference. For example, do you have your menu or website translated into the immigrants’ language? (And by the way, do you take non-native speakers’ needs into account in your company’s documents, from internal policy manuals to signage in your shops for non-native speaking tourists, etc.?) Do you observe cultural distinctions or holidays that your immigrant colleagues observe? Finally, given the share of your target market that this particular community makes up, are there any competitors better poised to capture the market?
Seasonal migrations and “gold rushes”
Seasonal migrations can also affect businesses on many levels. These migratory patterns often can have significant ramifications for employees, consumers and others. Migratory workers usually follow peak labor needs in agriculture, fisheries, and in other sectors with defined planting, processing or harvest seasons. As many farmers have learned the hard way, a significant event affecting one crop can have a major impact on the migration patterns of workers, and consequently the farmers’ costs and ability to effectively bring their crop to market.
From time to time around the world, a resource is discovered or a region or city starts a huge construction project, and these things attract workers as well. Your business might be on the fringe of all the frantic activity. It might gain or lose from the surge.
Emigration
Think of emigration as immigration, but viewed from the immigrant’s original home base, with a focus on the loss of those who go away. Emigrants are those who leave a homeland or region. Their departures affect many regions and countries throughout the world.
Common examples include the brain drain, where educated and professional individuals study and then stay abroad, or go abroad after studies and create talent and knowledge shortages back home. Or the mass emigrations we’ve witnessed, away from rural and agricultural areas to urban economies worldwide, leaving not only no workers, but also no heirs for the family farms. These trends can cause costs of products to rise and fall, and ditto for business opportunities. Factors that generally push people to leave an area include natural disasters (drought, monsoon, volcanic eruption), high unemployment, lack of rights, land shortages, resource depletion, oppressive conditions or persecution, warfare, famine or expulsion.
What does this mean for my business?
Good question. Immigration patterns may have deep, far-reaching effects on your business. They could come in the form of economic, social, political, health, crime, environmental, educational or local attitude effects.
Economic effects are often the most apparent in the business context. Does this immigrant population provide a new market or workers for your business? Will it increase or decrease your costs? What does it mean for your revenues and profits?
Social effects are influenced by the prevailing social norms of both the local population and the immigrant population. Sometimes there is resistance and even opposition to immigration by local populations; but other times, strong preferences for immigrants dominate. Resistance can take the form of general opposition, racism or xenophobia. Preferences range from hiring British-accented telephone receptionists in locations outside the United Kingdom where their accent lends a feeling of “class” to the operation, to hiring mine workers willing to do hard labor for low wages.
Political effects are evident in your daily news. All the issues we touch on in this section are capable of generating tremendous political change, policy review, and heated discussion, if not street warfare. Virtually every business today is affected by immigration in some way.
Health concerns of immigration include the actual health of a population, the customs of a particular group and their impact on immigrants’ health, their access to local health care and their actual or potential exposure to disease. Health issues directly correlate to immigrants’ ability to look for immediate employment or their need for certain services. What access to health care services does your new immigrant worker have? Could that influence his ability to recover from illness and return to work?
Crime and corruption may occur, and affect your business, when immigration is prevalent. When people are displaced, they can become easy prey for criminals or exploiters. Immigrants might target other immigrants or local people, and local people might target immigrants. On the other hand, some immigrant communities have a much lower incidence of crime than the general population. This could be due to cultural norms or the close-knit nature of the group.
Also you should consider the cultural norms of business held by different groups. In some cultures it is considered rude to negotiate or to talk business without first discussing social matters like children and families. Others expect spirited give and take on pricing, and paying an initial asking price is never an option. Bribes or tips for good service are required in some cultures and never given in others. These norms tend to migrate along with people, so as you interact in business with immigrant counterparts, be aware of the norms that are in play.
The environmental concerns of immigration include the exploitation of all available resources for use vs. conservation, as well as overloads on public services when immigrant groups arrive en masse in an area. And people of different origins may have different standards regarding environmentally sound practices. Newcomers used to keeping and slaughtering chickens in the back yard may conflict with local ordinances. These issues often have long-term effects on the local environment and/or public opinion towards particular populations.
Educational considerations include the current language skills and education level of the immigrant population (and therefore your consumers or employees), their access to further education, and finally the long-term educational opportunities for subsequent generations. The current level is the most immediate concern for your business. If immigrants are your consumers, then you need to consider their language skills and education level when planning where and how you advertise, what you say on your packaging, etc. If you tap the group for workers, you need to consider language and education levels and adjust them in your hiring, training, employment and managing practices.
Ongoing education is another factor you should consider in developing immigrant workers’ productivity and value. Supporting education at home is important too. Generally speaking, if your company’s practices value education, and for example offer flex-time scheduling to allow workers to attend school or be involved in their children’s school activities, everybody benefits. Cultures that value childhood education tend to be more stable.
Building a plan
The local attitudes towards immigration and immigrant groups should be factored into your business planning. In our globalized world, some form of this issue is near the top of the political debate in most regions. Whether it is related to the open or restrictive nature of the general policy, the legal status of protectionist measures of certain industries, or other issues, it is a heated debate. Your decision as a business owner to interact with immigrants could have short- and long-term effects on your business operations and should be reviewed carefully and periodically.
The economic or other conditions of the home country should also be considered in planning in relation to immigrant populations. For instance, the resolution of a home country conflict could lead to a mass movement back to the home region and a loss of employees or consumers for your business. Or a shift in the currency exchange rate back home could be a significant factor in determining what wage an immigrant may need to earn as your employee.
Finally, it’s important to remember that many immigrants have a specific goals that motivate them: to get an education and move back home, to earn money and send it home, to save enough money to move the family to their location or to attain local citizenship. These goals should also be considered in your business planning. You can’t predict the future, but you can consider it in advance.
M.R.M.