Often a business can only grow so far under its own steam before it starts to look elsewhere for expansion opportunities. Sometimes, the best opportunities come from places that a business owner might not have considered before, such as those offered by foreign investors who are looking to gain a foothold in the business owner’s country.

The pros and cons

There are several advantages to wanting to attract foreign investment as a means of growing your business. The most obvious is the access to greater capital, but there is also the opportunity to create more jobs locally and as a result, increase the sales opportunities for suppliers in your area. Increased prosperity for the community in which you work is always good and has the added bonus of you feeling good about something that is beneficial for all concerned. In time, this may also lead to your work area being recognized as an attractive place in which to invest.

Then there are the direct advantages to your business. A foreign investor such as Fahad Alrajaan, a key and prolific investor in the Middle East who is always looking for business expansion openings abroad, will undoubtedly have access to a range of people whose skillsets are just what your business needs and which are lacking locally. They may also have the means of introducing your company to new technologies, as well as new exciting markets that will speed up your growth.

Global Business

However, just as there are pros to foreign investment, there are cons. Perhaps chief among these is the risk you run of putting your local or homegrown business associates’ noses out of joint. It is possible that suppliers and even customers will desert you if they see you sourcing foreign investment. Foreign investment may also drive down the prices of the goods you supply, so that you are able to provide goods to your customers more cheaply. This has a knock-on effect of forcing your competition to do the same, which may ultimately lead to job losses.

Then there are the internal disadvantages to you and your business. A foreign investor will naturally want to have some say and control over how their money is spent, and this will likely curb your freedom to act as you choose. Through expansion, they may take your company in directions you had not considered before and do not want to venture into. Moreover, while you may have a concern about acting in the best interests of your company and local community, they may not. They will want to receive a good return on their investment that may come at a price you are unwilling to pay.

Finding a foreign investor can be a difficult business and you will need a strategy to do so. You will need to target the correct industry sectors to find suitable investors who match your vision, as well as ensuring your business has the potential to grow. In short, your company needs to be just what a foreign investor is looking for.

This entry was posted on Friday, October 9th, 2015 at 4:32 pm and is filed under Business, Investment. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.