international markets 23


Breaking new ground – how to expand overseas with success


What is holding businesses back from expanding overseas? For many, the magnitude of the task simply looks too daunting; cultural clashes, corruption, powerful unions and alien regulatory regimes all act as strong deterrents, writes James Slipper, partner, Gresham Private Equity


Despite the risks, operationally at least, UK companies are in a better position than ever before to take their market- leading skill sets into new territories. Cloud computing, remotely accessible servers and improved worldwide communications and transport infrastructure have eased many of the operational difficulties previously experienced during internationalisation efforts. But, when deciding where to expand, every strategy should be devised on an individual basis.


Gresham’s current portfolio companies have more than 60 overseas operations between them


Gresham has a long tradition of working alongside management teams to increase revenue and profitability through internationalisation. With the support and guidance of Gresham partners, portfolio companies past and present, like Beck & Politzer, Swift and 7city, have successfully expanded abroad. Today, Gresham’s current portfolio companies have more than 60 overseas operations between them.


Beck & Politzer was a Dartford-based industrial relocation business that had been helping clients to relocate and install factories and machinery across the UK and Europe from its UK base. After winning multiple contracts on the continent, it became clear that to service clients well, local offices would be necessary. Beck & Politzer proceeded to follow its client footprint and set up operations in France, Germany, Poland, Hungary and the Czech Republic. Seven years after Gresham’s exit, its scarlet lorries remain a common sight on roads across Europe.


7city had offices in London and New York. Since then, it has opened operations in Dubai and Singapore


Gresham invested in Swift, a leading oil and gas recruiter, in 2006. Since then its international reach has increased substantially. When I first became involved in the business, it had five offices in five countries and 70 staff. Like Beck & Politzer, Swift moved into new markets in order to service its clients’ needs and it now has 22


THE BUSINESS MAGAZINE – THAMES VALLEY – APRIL 2012


offices in 11 countries and 350 staff. Only last month, Swift opened yet another office – this time in Ghana.


7city is a financial training company. At the time of Gresham’s investment, 7city had offices in London and New York. Since then, it has opened operations in Dubai and Singapore, developed a new international management and reporting structure and provides training to all the top 10 international investment banks and nine of the top 10 global fund managers. This has given it a truly global footprint.


There are many different ways to internationalise: acquisition, organic growth, offshoring and others. But, many companies undergoing the international expansion process face similar challenges. For example, staffing a foreign operation can be one of the most demanding but important tasks to consider when preparing to expand internationally.


When 7city opened in Singapore and New York, it was able to use existing employees because the markets were more open to expatriates. In Russia, however, Swift has found that local staff are a better option and it only employs local people in its four Russian offices.


Partnering with a private equity firm, which has experience of internationalisation and which can provide an upfront cash injection, can make the road to successful internationalisation much smoother


Other practicalities of international expansion, such as the regulatory, legal and tax requirements of setting up in different jurisdictions, can appear daunting to most business owners, especially if a company has no experience of expanding abroad and no local contacts to introduce it to local processes.


Faced with all the considerations involved in planning for international expansion, it is understandable that many business owners feel reluctant to take the plunge. Partnering with a private equity firm, which has experience of internationalisation


and which can provide an upfront cash injection, can make the road to successful internationalisation much smoother.


Aside from the expertise that comes from a good private equity partner, the portfolio of investee companies can also act like a business network sharing advice, experience and even suppliers and customers. And, as several of our companies that have operations in the same foreign cities have found, having another member of the Gresham family just down the road can prove to be very useful when you are 5,000 miles from home.


Companies in the Thames Valley should make sure they do not miss the opportunities that are waiting for them in foreign markets. Working with businesses valued under £100 million, and with a significant regional presence, Gresham is uniquely placed to work alongside management teams in the area to help them realise the benefits of successful international expansion.


Details: james.slipper@greshampe.com simon.hemley@greshampe.com 020-7309-5000 www.greshampe.com


www.businessmag.co.uk


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52