4 In Five CFOs Look Abroad To Gain Market Share, But Weighed Down By Multiple Concerns

Profession:TMF Group
 
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Whilst stronger economic conditions are driving businesses to look at international expansion, concerns about entering new markets continue to dent optimism...

In a bid to gain market share, four in five (82%) chief financial officers (CFO) would look abroad, according to research commissioned by TMF Group, a leading global provider of high-value business services.

Published by the Economist Intelligence Unit (EIU), the study 'Corporate overseas expansion - opportunities and barriers' also finds that the next biggest motivation for CFOs to expand overseas is to open new markets for their products and services (67%). Nearly half (49%) indicated that expansion is also in response to increased competition in home markets, while the same number of CFOs also cite improving R&D and technology resources as a reason to take their business abroad.

TOP 5 REASONS FOR CFOS TO CHOOSE EXPANSION INTO FOREIGN MARKETS % Gain market share in target market 81.8 Opening new markets in products and services 66.7 Improve R&D and technology resources 48.5 Seeking foreign markets in response to increasing competition in home market 48.5 Producing more cost effectively 42.4 Despite these reasons, however, the CFOs questioned are concerned by the socio-economic conditions, environmental considerations and security and safety issues when moving into a new market. 30% of respondents rated these issues as 4-5 (on a scale from 1-5) in terms of the severity of problems their company has encountered when moving into foreign markets.

In terms of other concerns for CFOs, the availability of skilled local workers, visas and immigration issues, and the costs of the local workforce, also. Each of these issues was highlighted as a concern for over 30% of CFO respondents. By contrast, COOs and CPOs are more concerned with local employment customs, practices and laws.

Frederik van Tuyll, Chief Executive of TMF Group, said...

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