Navigating Taxes and Insurances When Expanding Business Operations to the USA: Overcoming the Challenges
Steve Pastor, the founder and CEO of Kings of Neon gives his insight and fundamentals for scaling your business and taking global expansion in your stride.
As every business owner knows, there are fundamentals that are essential and can’t be ignored when it comes to global expansion. If you are moving your business to have an international presence, there are things you need to have a good understanding of so you can scale and thrive. Below are the three things that Steve from Kings of Neon says are the key to your success:
1) Taxes & Insurances
Expanding business operations to a new country is an exciting venture, but it comes with its fair share of challenges. For Australians looking to operate in the USA, understanding and effectively navigating the complex tax and insurance landscape can feel overwhelming. The US market and Tax Code is known for its complexity, with numerous regulations, deductions and reporting requirements that vary at federal, state and local levels. It can feel daunting for any business that is unfamiliar with the system but even more of a reason to dive in and understand it.
To address this challenge, it’s crucial to seek out expert advice early on. With the right strategies and expert guidance, it’s possible to overcome these hurdles and ensure compliance while minimising tax burdens and mitigating risks. Steve Pastor and his team recognised that partnering with professionals who specialise in international tax laws can provide invaluable guidance. These experts were able to help ensure compliance with US tax regulations while identifying opportunities to minimise tax liabilities through legitimate strategies like tax credits and deductions.
Understanding the tax laws and requirements of the new country is essential for successful expansion. While it may be tempting to ignore or postpone dealing with taxes, gaining a thorough understanding of the process will provide clarity and confidence in managing obligations effectively. By embracing the intricacies of the US tax system, businesses can proactively plan and allocate resources, ultimately fueling their growth and expansion goals.
Insurance is another critical aspect that cannot be overlooked when operating in foreign markets, such as the USA. Each country has its unique insurance frameworks, legal requirements, and liabilities. Australians entering the US market must ensure they have the proper insurance coverage to protect themselves, their business and their employees.
Like anything in business, don’t make assumptions about insurance requirements when expanding internationally. Consulting with insurance experts who are well-versed in the specific regulations of the US market can help businesses navigate the complexities of coverage, liabilities, and compliance. By obtaining comprehensive insurance tailored to meet the specific needs of the US operating environment, businesses can safeguard their operations and mitigate potential risks.
Kings Of Neon encountered the need to further explore insurance requirements when they secured an order for the NFL Draft in Las Vegas in 2022. As a major event with significant risks and liabilities, the NFL Draft necessitated a deeper understanding of insurance laws and compliance. To be able to fulfil the order and send the required team to the event, it was imperative to organise specific insurances that aligned with the laws and requirements for the Las Vegas event. Steve knew that proactively understanding these insurance laws and partnering with experts in event insurance would be a pivotal moment for the business and an opportunity to level up to the next step in the global expansion plan.
As you embark on your journey of expanding business operations to the USA, remember that investing time and effort into understanding taxes and insurances will pay off in the long run. By proactively managing these elements, you can navigate the complexities with confidence, protect your business, and position yourself for sustainable growth in the American market. Plus having that understanding and knowledge allows you to foster a stronger foundation and create better partnerships with your international counterparts.
2) Shipping & Logistics
Logistics can be a challenging aspect of eCommerce, and shipping is the lifeline of any business. Steve and his team quickly realised that mastering shipping lanes and delivery was crucial. They invested in efficient shipping solutions and forged strong partnerships with carriers to guarantee safe and timely deliveries of their LED neon signage to customers around the globe. It has had its challenges over the last few years and all business owners know the cost and impact that it can have on your bottom line.
Do your research, know who your carriers are, see if you can get a representative and an account so you are a priority. Don’t just accept a price and position. Pick up the phone, ask the question and see where you can get better deals. If you are spending hundreds of thousands, to millions of dollars on shipping, you have leverage and a position so ensure you are getting the best deal.
Another element to this, and you will hear different opinions, but don’t over order stock and hold onto millions of dollars of products. Cash flow is king and if you sort your logistics out and are well organised you can make more moves.
3) Change The Marketing Tone to The Overseas Market
In the noisy world of eCommerce, a distinctive marketing voice and strategy can be your secret weapon. Often businesses that nail it in their native country take that success and growth and expand into additional markets.
The reality is, each country has its own tone and consumer profiles. The look and feel of the ads, website and customer journey needs to be focused on each market and personalised. Kings of Neon reached success when there was more focus and understanding on the consumer in each area. For instance, The USA consumer behaviours are vastly different from the consumer behaviours in Australia. So often we see people try to just replicate the same strategies for the USA and it doesn’t always get cut through. The size and population, saturation, competitors and shipping in the USA is miles apart from Australia. Don’t forget to also ensure that your website is also written with the correct tone, as well as spelling and words that are native to the country as it can have a huge impact.
People want to ‘shop local’ or at least feel like they are shopping local. If the user is on a website and it is written for a different country you would be surprised at how fast people will jump off and search for a ‘local’ supplier or brand. Don’t be what we would call ‘store blind’, do your research, go visit the country, learn about the people and your consumers in that area and speak to them.
Kings of Neon
Steve Pastor is an accomplished seven-figure entrepreneur,
keynote speaker, and host of the Flipped Podcast. He has built a reputation as a thought leader and trusted advisor to
companies and organizations around the world, with over 10+ years of experience in e-commerce and entrepreneurship. Steve has been named in the Top 20 Businesses in the AFR Fastest 100 Businesses in Australia 2022 and has received numerous awards, including the Business NSW Export Award in 2022. He was a finalist for Sydney Top Entrepreneur 2022 and has been featured in numerous publications, including the Australian Financial Review, Sydney Top Entrepreneurs, Business NSW, CNN, Apple News, and NBC.
As the co-founder of Three Fingers Naturals Zinc, Slyde, and
Cookie Dough Marketing, Steve has a track record of success
in building and scaling businesses. He took his latest venture, Kings of Neon, to $7 million+ in less than three years and has worked with global brands and social icons such as Gary Vee, NFL, Lollapalooza, TikTok, Twitter, McDonald’s, and Netflix.
Steve is passionate about e-commerce, leadership, and
personal development. He has multiple degrees and
certifications in sales, marketing, and leadership and is an
active member of Brand Builders Group and E-Commerce
Equation. In his spare time, Steve loves to spend time with his family, attempt golf, play tennis, and train 7 days a week. He is the proud husband and father of two headstrong kids who always keep him on his toes.
Steve is on a mission to help aspiring entrepreneurs launch
their own businesses and break through limitations. He is
relentless about business success and passionate about
building community. Don’t miss out on the opportunity to
hear from this leading expert in the field of e-commerce and entrepreneurship.