IVC: Into the Australian market without a local entity

International Vitamin Corporation — 80+ countries, 10+ factories, one of the largest OTC supplement manufacturers in the world — needed an Australian foothold. Remote People delivered the market entry without setting up a local entity.

Sectors Consumer Health · Supplements · Manufacturing

Challenge Open the Australian market for an 80-country supplements manufacturer — without setting up a new local entity.

Location

China

Industry

Pharma

Company size

500+

Founding Year

2010

With Remote People since

2021

Content

5 minutes read

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Global presence, great potential

The International Vitamin Corporation (IVC), based in California, USA and Jiangsu, China, was established in 2010. They are one of the largest manufacturers of over-the-counter health supplements in the word.

Over the last 10+ years, IVC has undergone more than 11 cross-border mergers and acquisitions, some of which have been significant (like the 2019 acquisition of American supplement giant GNC’s manufacturing capacity). Through these M&A activities, IVC has consolidated the manufacturing, product R&D, and supply chain management of their business under one umbrella, allowing the company to provide the most value at the least cost to customers worldwide.

These activities have allowed IVC to steadily grow its market share in the nutritional supplements industry and establish more than 10 factories across Asia, North America, and Europe. At present, IVC and its companies have a footprint and market influence in more than 80 countries, and are committed to entering every market as a leading global provider of nutritional and health supplements.

However, with the Covid-19 pandemic situation, their ability to open new markets was challenged—particularly in APAC where they had planned expansions for 2020-2021. During these challenges, they discovered global employer of record (EOR) services.

IVC realized that with EOR support where needed, they would be able to quickly scale their operations in new markets, anywhere in the world, without business trips or company incorporation formalities. EOR would allow them to be flexible to easily start new business in the face of economic uncertainty.

After assessing the EOR marketplace, IVC decided that Remote People would be the best fit for their Australian expansion—the price, ease of communication, and the global & regional reputation of Remote People helped IVC make their decision.

The general trend of the health market is going global. Anticipating this, the top priority for us is employing global talents—quickly, affordably, and compliantly—and that is something Remote People excels at facilitating.

Sheng Liang HR at IVC

Why IVC switched from fully-staffed local offices to a branch model

Before Covid-19, as part of its globalization strategy, IVC wanted to change the way they structure their international offices.

Where before the company had international offices that were completely localized with full back office and operations in each country of operation, IVC had an ambitious target to transition these offices into a ‘branch-like’ structure with a central command. If this were achieved, the company would be able to optimize the resources shared between different countries and regions and increase organizational efficiency.

With Remote People’s EOR, the HR side of this critical mission became easy in countries where EOR is utilized. IVC realized that when it comes to international operations, it’s better to have the best person for the role working the job, no matter where they are located.

For example, IVC has 7 factories globally and the company’s products can be found in over 80 countries worldwide. Does IVC need an entity in all 80 of those countries? They decided not.

What IVC weighed before entering Australia

Australian market share:
With a valuable and well-documented health and fitness market, it’s no wonder IVC wanted to enter the Australian market.

Speed:
The faster you enter a new market, the quicker you can learn how to be successful. The fastest way to enter new markets is to partner with a company like Remote People who can ensure local hiring compliance (because as an EOR, Remote People would be legally responsible for such matters).

Cost:
IVC could have chosen to set up a local entity, but this would have required serious time and financial burdens. IVC would have need to hire a local HR and legal back-office just to employ a small team of salespeople. They decided to go with the smart option and use an EOR.

Risk:
Compliance burdens when entering new markets are serious. Mistakes can mean delayed company openings, damaged relationships with employees, and massive fines. By partnering with Remote People in Australia, IVC avoided the risks typically associated with new international hirings in unfamiliar jurisdictions.

Efficiency:
There is already ramp-up time when hiring new employees—not to mention new offices. When starting in new, unfamiliar markets it can take many months to become efficient (after waiting months to be able to hire). When IVC no longer had to worry about local laws, taxes, or cultural / language issues when handling HR matters, they were able to scale their efficiency much more quickly.

Remote People made every aspect of our hiring project in Australia easier. Where we normally face challenges, we were able to quickly pass through hiring formalities to get the real work started.

Sheng Liang HR at IVC

The result: faster Australia entry, plus ongoing EOR support

IVC’s internationalization efforts won’t stop here. With a presence in over 80 countries already, and the relatively new (to them) tool of global EOR added to their HR toolbox, it’s only the beginning.

Thanks Remote People for amplifying our internationalization efforts. Our project in Australia was quick, efficient, and compliant, and a lower cost than if we had started our own company there. If you’re thinking about hiring abroad, go with Remote People!

Sheng Liang HR at IVC