Do you have a business that is looking for expansion opportunities outside of Australia? Foreign firms have identified Malaysia as an ideal setting for market penetration due to some gains that they stand to achieve there. This article will investigate reasons why Malaysia would be a good place for Australian companies and offer easy procedures for starting an enterprise in that nation.
Content Outline
Why Malaysia?
The economy of Malaysia is experiencing fast growth and it lies strategically in Southeast Asia. Its political stability and boasts of a good network and possesses an energetic work force. Moreover, the country enjoys immense ties with Australia and thus constitutes excellent grounds for Australian firms that seek to globalize their scope of operation.
Market Penetration Opportunities
The Malaysian market presents many avenues through which Australian companies can penetrate. It is the third largest economy in Southeast Asia with over 32 million people and an increasing middle class that creates a huge opportunity for Australian firms.
The Malaysian market also contributes substantially into the wider ASEAN market of more than 650 million inhabitants. Due to this, the place becomes a perfect point of reference for companies looking to expand within the area.
Favorable Business Environment
Malaysia is one region that showcases favorable costs of living and running a business. The country has a mature infrastructure in place, including current transport networks as well as sophisticated communication channels. This way, businesses can easily do business across the world with ease and accessibility.
Moreover, Malaysia has a stable political system and business-friendly government that makes it an attractive place for foreign investors. Additionally, it enforces a credible judicial system backed by a democratic system that creates confidence in conducting business.
Strong Relationship with Australia
The two countries of Malaysia and Australia have enjoyed very close relations for a long time characterized by mutually beneficial economic and socio-cultural exchanges. The countries have signed the free trade agreement which makes it easier for Australian firms to do business in Malaysia. Therefore, this encourages Australian firms to do business with Malaysia easily.
Setting Up Your Business in Malaysia
So, now you know why Malaysia is a perfect place for an Australian firm; let’s look at what it takes to do business in Malaysia.
Step 1: Determine Your Business Structure
The first thing when setting up your business in Malaysia is to choose a business structure that is most appropriate for your company. Typical options for foreign firms are a representative office, branch office or subsidiary corporation.
A representative office is a non-trading organization that acts as an intermediary between the mother company and prospects in Malaysia. Under normal circumstances, a branch office is considered an extension of the principal company, which enjoys business privileges in Malaysia. The subsidiary is a distinct corporation from the parent company and can operate its business separately.
Step 2: Register Your Business
After deciding on the business structure, it is time to register your company with the Companies Commission of Malaysia (SSM). The documents you will need to submit include the constitution of your company, memorandum and articles of association and a statutory declaration.
You will also be required to have a resident director as well as a company secretary who is an approved member of any professional body under the SSM.
Step 3: Obtain Necessary Licenses and Permits
However, depending on what you will be doing within the business, it may be a requirement that more licenses and permits should be sought from the relevant authorities. For instance, if a person is setting up a manufacturing company he or she will approach the Malaysian Investment Development Authority (MIDA) and obtain a manufacturing license.
Step 4: Open a Bank Account
You will be required to open a bank account with a Malaysia-based bank to operate the business in Malaysia. With this, you can do your financial operations or rather manage the business finances in the local currency.
Opening a bank account will require you to present the relevant documents including your company’s registration documents, director’s identification, as well as proof of address.
Step 5: Hire Employees
After you have established your business, you will require employees who can assist in managing various things while operating in Malaysia. Understanding local labor laws and regulations is important for compliance when employing workers.
FastLane assists the Australia companies in Malaysia with HR & payroll services.
It will be equally vital for you to get a work permit from the foreign employees whom you may want to employ. The Malaysian government has introduced several improved initiatives that have enhanced getting foreign talent, this in turn simplifies the hiring process to acquire a talented foreign worker.
Conclusion
Australian firms seeking to go international find many advantages in operating in Malaysia. It is also a perfect destination for those companies that would like to enter the Southeast Asian market, due to the favorable business environment and opportunities it provides for market penetration.
This guide will help you to successfully establish your business in Malaysia, so that you can tap into the numerous opportunities available. Your company can be successful in its international expansion if you plan and research well. For seamless global expansion, reach out to FastLane Group. Our mission focuses on transitioning businesses from local to global markets.