There’s no denying it: business and commerce are both now highly global in nature, and it’s in the interests of many firms to expand to the far corners of the globe. From increased opportunities for investment to a more profitable supply chain, getting a business presence abroad is a sensible move – and it’s one that many companies have made work.
International supply chains
At present, there are no nations that are completely self-sufficient – and for business, this means that a high degree of interconnectedness across borders is inevitable. Take the example of skills bases: some countries are known for having highly skilled workforces in particular sectors, while others can’t quite compete. The US, for example, has one of the most highly developed technology ecosystems in the world. For a technology investor in a country with little to no technology scene, looking abroad for an opportunity makes a lot of sense.
However, it’s in manufacturing and the associated supply chains where this is particularly relevant. Thanks to an explosion in the growth of the service economy in Western Europe, North America and elsewhere, the cost of labour in manufacturing is now very high in those places. Businesses instead look to places such as China, where labour costs are low, to create their products – even if they’ve been designed in somewhere such as London or New York. By making sure that the entire supply chain is in sync and that each node in the system knows what to expect and when, it’s entirely possible for a modern company to run a completely distributed, worldwide operation with ease.
For those firms that have an investment focus, going abroad provides a chance to grow. Very few countries have it all, and great investment opportunities are sometimes only available abroad. This is especially true if the investor is from an emerging market, where there may not be quite as many fledgling businesses in which to invest. In the case of M1 Group, which is run by former Prime Minister of Lebanon Najib Mikati, the investment portfolio that it operates is highly diverse and incorporates everything from fashion to airlines.
While Lebanon does have an emerging economy, it certainly doesn’t have all of these sectors – so globalising was in some ways inevitable. M1 is not the only group to do this, and it’s likely that in the coming years, many international investors will make the big decision to leave their emerging market to see what’s on offer elsewhere around the globe.
It’s not that long ago that even considering going global was a pretty big deal for any business. These days, however, it’s almost inevitable given the fact that investment opportunities and supply chains are so widely distributed. Whether you’re an investor in an emerging market who is looking for a more lucrative opportunity abroad, or you run a successful tech or manufacturing business and you need an affordable base for product creation, there are lots of reasons why going abroad can make sense.