Where to relocate your business? Where to start a new one?
The focus of SBSB activity is the support of fintech and crypto projects. However the requests of business relocation from Ukraine to some other countries became more frequent lately, because of ongoing military operations.
One of my recent clients and a friend of mine, Dmitry, had the same request. It motivated me to write an article with some general tips for moving your business from Ukraine to a new location.
Previously, people hoped and expected that the war would end quickly. But it is June on the calendar and entrepreneurs are starting to realize that they need to have a backup plan.
I’ll get straight to the point. Here are a few recommendations that you need to take into account when choosing a country to relocate your business.
I prefer to divide all businesses into two groups: offline and online enterprises. Let’s begin with discussing the offline business. And some tips regarding online business you will find at the second part of this article.
1. Your target audience and its mentality
You need to understand whether the language, mentality and habits of your customers will change. In this regard, you need to consider if it is necessary to hire an employee who speaks a local language.
For example, when you open a beauty salon in Europe. Do not forget that ladies from the CIS and Europe are very different. A Slavic woman spends her last money to do manicure and beauty treatments, and a Czech woman, for instance, spends them to buy a bicycle, because she is not too concerned for her nails. Therefore, you should take into account that the demand for cozy and luxurious beauty salons in Ukraine is much higher than in Europe.
2. Relocation budget and further maintenance of a business
Here are some expenses that you need to take into consideration:
- legal expenses. It includes company registration fees, state fees, notarial expenses, a bank account opening for your activity, etc;
- staff. This point includes the expenses on your team relocation and getting settled in a new place. You should also think ahead if you need to hire a local staff;
- office. If you need a real offline office, find out in advance per square meter cost in the desired area;
- taxes. This is a very important point when you choose a country for business relocation. For example, if you like France very much, you plan to stay there and start a business.
But the thing is that the tax climate in France is not favorable for entrepreneurs. It is hard to afford even for local French businessmen because of the extremely high taxes.
3. Work life balance
And of course, the country you choose should be comfortable for you to live in. In my opinion, you shouldn’t do business in a country that you don’t like or with people you can’t stand. All the parts of a business puzzle should fit together.
4. And the last but not least
If you are lucky to have an online business, for example in the IT sector, then you are free to live in any country you love and provide services/products to different target markets.
If your company was previously registered on the territory of Ukraine, then I want to offer you a number of jurisdictions suitable for doing business via the Internet.
Estonia is a small European country with very favorable tax climate:
- zero income tax, which you should pay only in a case you work closely with Estonian residents;
- a company can be registered remotely in just a few days, without visiting Estonia;
- startup expenses are within €1000-2000.
There are a number of other benefits for those who plan to live in Estonia.
Many e-businesses have already evaluated the comfort of registration and doing business through a British company:
- fast, remote and inexpensive registration (average €1500);
- transparent taxation;
- clear financial reporting system.
However, having a company does not give its owners any advantages for obtaining a British residence permit or citizenship.
I would recommend relocating a company to the States only if a business works with the dollar and with customers from the USA.
The total incorporation procedure usually takes a period up to two weeks and expenses depend on the chosen state.
Malta is preferred by IT, fintech and e-commerce professionals. In particular, those companies that actually relocate their teams. In this case, Malta is unique and has a number of advantages:
- tax benefits for IT businesses;
- clear taxation;
- English is the official language;
- wonderful climate — who wouldn’t like to move to Malta to enjoy the sun and the sea?
Of course, there are a number of countries where it is convenient to do business online. But I have chosen the TOP 5 of the most popular.
Business relocation is a turning point, the future of the business itself, the employees and the owners depends on it. Therefore, the approach to this issue should be thoughtful. The first thing to do is to make a decision to relocate. Which further will be followed by different processes, numbers and legal details 🙂
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