El Salvador has rapidly risen to prominence in Latin America. The nation has the third-largest economy in Central America, minimal inequality, and a growing middle class with disposable income to spend on luxury products and services. For those seeking to extend their businesses here, there are numerous chances.
Companies with industry knowledge who are willing to join a new country and exploit its market for profitability and expansion have many enticing chances because investors often overlook the country. This country boasts various internationally competitive industries, such as its industrial and agricultural sectors, and imports and exports account for more than 60% of its GDP, thanks to trade agreements. This country is a part of the Central American Common Market (CACM), a trade organization whose goal is to promote economic growth among its member nations.
This country is a secure bet for companies trying to expand into Latin America, with enormous potential just waiting to be harnessed.
Access demand
It’s crucial to gauge demand for your goods or services before expanding into Latin American markets. Because of cheap raw resources, coffee, sugar, baked goods, confectionery, dairy products, tobacco, soap, candles, matches, furniture, light metals, and organic fertilizers are all mass-produced in the country. Therefore, entering one of these niches would require a differentiator or a manufacture-to-export strategy.
Determine whether you can compete on quality or price by evaluating the competition from important industrial areas including San Salvador, La Libertad, Santa Ana, San Miguel, Usulutan, and San Vicente. Instead of competing head-to-head, it may be wise to link up with a local specialist to make your items so they may be marketed in different marketplaces.
You may evaluate the demand for your goods and services in a variety of ways. It would be a good idea to start on Google and check the trends section to see how many people in El Salvador are looking for products similar to yours. To choose the most effective marketing plan, you might examine your rivals, find out their market share, and speak with potential clients through primary research.
Decide on the type of company structure
There are several choices if you want to develop your business in El Salvador. Investors in El Salvador have a variety of options for legal entities that can be set up to carry out business operations.
Find trade opportunities
It makes sense to network and look for trade prospects with companies before you incorporate in the country because many startup businesses are expected to grow in 2019. As our society becomes more international, it is unrealistic to expect to establish important economic connections immediately; some take months or even years and constant effort.
Visit the nation on a networking expedition before you start doing business there and meet as many company executives as you can. Participating at trade exhibitions, implementing an internet marketing strategy, and organizing in-person meet-ups are the best ways to promote your brand and differentiate yourself from regional and international competition.
Incorporate your business
Once you’ve decided to stay in El Salvador, you should familiarize yourself with the procedures for forming a business there. There are a few straightforward conditions you must remember. The first step is to have your business registered with a public notary. Once all conditions have been satisfied, you can apply for a Tax Identification Number and start doing business.
Employ staffs
Choosing employees to work for your company is the next stage after opening a business in El Salvador. You can employ international workers in El Salvador, but employment contracts will have restrictions, so you can’t just transfer your staff from one nation to another for quick expansion. Foreign employees are limited to 10% by the government, and the total amount of salaries given to foreign employees cannot exceed 15% of your overall pay expenditure. It is important to note that the 10-15% guideline does not apply to foreign directors, managers, and administrators.
