Home / Articles / Nonprofits: Look before you leap international borders

Nonprofits: Look before you leap international borders

January 2, 2019

Share:

Many not-for-profits look beyond the United States to boost revenue. They recruit members, sell products, promote conferences or solicit donations abroad. But it’s important to look before you leap borders; consider not only potential windfalls, but also pitfalls.

Research your target

Before your nonprofit invests funds internationally, make sure that the need in your target country for your services or products is robust enough to justify the costs of doing business there. For instance, what will your competition be like? Ample research is essential before making a decision.

This includes gathering information about the country’s relevant laws and regulations. If you plan to sell products or services there, investigate sales and tax issues thoroughly. If, for example, the country engages in free trade, it may be easy to do business there. But if the country isn’t a party to a free trade agreement with the United States, high tariffs might prove an insurmountable obstacle.

Consult with legal and financial advisors as you chart your business plan. Foreign activities also may require analysis to ensure that your American contributors retain their tax deductions and that you don’t jeopardize your organization’s own tax-exempt status.

Put people first

Your understanding of the target country’s people will be key to your success. Setting up a cultural advisory committee in the United States that includes expatriates is one way to develop insights into your new market. If English isn’t the primary spoken language in the target country, bring a translator along on exploratory visits.

Offering membership to individuals in other countries can be your initial step toward becoming a global organization. Some organizations hold seminars and conferences for these potential new members and even open local offices to establish roots.

If you appoint a member from the target country to your board, be willing to accept different approaches to issues. Board meetings probably will continue to be held at your U.S. headquarters. But videoconferencing applications and collaborative software can help board members participate fully in meetings regardless of physical location.

Consider currency

Finally, don’t discount the potential impact of currency exchange rates. If the U.S. dollar is weak, it could work to your advantage in selling products and services abroad. On the other hand, a strong dollar will likely go further when leasing foreign property or compensating international staff. Contact us for more information about the financial implications of expanding globally.

© 2018

All content provided in this article is for informational purposes only. Matters discussed in this article are subject to change. For up-to-date information on this subject please contact a Clark Schaefer Hackett professional. Clark Schaefer Hackett will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.

Guidance

Related Articles

Article

2 Min Read

Five Supply Chain Technologies That Increase Competitive Advantage

Article

5 Min Listen

Podcast: Highlights from the Global Supply Chain and Covid-19 Webinar

Article

4 Min Read

Reimagining the Global Supply Chain

Article

7 Min Read

Covid-19: Considerations for International Companies

Article

2 Min Read

International Tax Update: FBAR and Section 965

Article

3 Min Read

The Coronavirus Effect on the Global Manufacturing Supply Chain

Get in Touch.

What service are you looking for? We'll match you with an experienced advisor, who will help you find an effective and sustainable solution.
  • Hidden
  • This field is for validation purposes and should be left unchanged.