The three top challenges of international growth

Even the military has played on the promise of travel to entice eager young recruits onto the oceans with the famous ad: “Join the navy – see the world!”

Businesses have always looked to new countries for growth, and the ambition for international expansion remains a priority for UK leaders today. This is a key trend identified in our survey of more than 500 UK C-suite leaders, the detail of which you can read in the C-suite barometer 2026 report.

It’s worth noting this is set against a global backdrop of geoeconomic uncertainty, as well as a domestic economy which has been consistently off the boil for some time. Despite this, our C-suite is remarkably positive about the future, with 96% of survey respondents predicting growth in the next 12 months.

International expansion is expected to play an important role in this growth, according to our data. Some 23% of C-suite executives identified this as a top priority over the next three-to-five years. We should note that this was identical for UK and global respondents, underlining that a considered international growth strategy is a competitive imperative as well as a strategic opportunity.

To achieve this, UK executives are planning to put their shoulders to the wheel. Cognisant of the challenges they face, UK companies are largely choosing to expand the scope of their global growth efforts. Chief among the obstacles in their path is the unstable geopolitical picture, cited by 64% of respondents as a top consideration. Trade and tariffs also cast a notable shadow for 54% of UK executives – the same result as the rest of the world.  

In response, though, UK companies are choosing to spread their risk. Almost half – 46% – say they’ll target one or two new countries as part of their growth strategy; another 30% say they’ll begin operating in three-to-five new countries.

There are challenges to be faced, of course, when it comes to implementing such plans. The top three identified by our C-suite respondents were:

• 44Compliance with local laws, regulations and taxes
• 39Trade and tariff changes 
• 35Adapting or upscaling technology

The scale of the compliance challenge  

It’s no wonder that C-suite executives see compliance with local regulatory and legal requirements as a key challenge. Not only is it a constantly moving picture, but the ambition of pursuing growth in multiple territories brings with it an associated miasma of compliance obligations.  

Companies have to manage the short-term necessity of slotting their new or growing operations into the compliance requirements of today, while creating a framework of regulatory, tax and legal adherence which can evolve with local jurisdictions as needed.  

The critical point is that leaders should give themselves enough time to plan appropriately. The most successful expansion initiatives we see are those which are backed by a thorough understanding of how to answer the compliance questions of the target countries. This takes time, but it’s a worthwhile investment. Retrofitting a compliance strategy is rarely the right approach.  

Our survey showed that the US was the top target for UK companies seeking to grow overseas, where 41% of those pursuing international growth saw the biggest opportunity. The US was followed by France (29%), Canada (28%), Germany and Australia (both 27%).  

Consider too that 30% of companies will target between three and five new countries this year. Let’s say those five are the top targets for the survey. That doesn’t mean there are ‘only’ five jurisdictions to consider, though this would be challenging enough. The US alone involves a complex picture of federal requirements, as well as state and local specifics.  

Depending on where businesses see growth opportunities, starting with compliance obligations – and doing it as early as possible – provides the best chance of making the most of targeting international markets.  

Tariffs and trade  

Despite the well-documented challenges of US trade tariffs, it’s telling that UK companies still see it as a land of opportunity. That 41% of all companies which plan to grow internationally have the US at the top of their target list strongly suggests a will to maintain access to the world’s biggest economy.  

The recent requirements for non-US companies to invest in domestic infrastructure has done little to dampen the enthusiasm for a Stateside growth strategy, especially in comparison to the other target countries in our top five.  

There’s no question that the US holds an extremely attractive growth opportunity. That said, domestic and global geopolitics could mean that, in the relatively short-term, an economic slowdown or a change of government might prompt the phasing out of domestic investment prerequisites for access to its consumer market. In that scenario, would having a robust US infrastructure still be optimal? Or would a less permanent set-up be required?  

In the meantime, and more broadly, identifying stable economies in which to plant a flag is usually the safest bet when striking out for new shores. That goes a long way to explaining our C-suite’s preference for the top five where the rule of law and a steady economic performance can generally be relied upon.    

But economies everywhere are tough, and the full impact of tariffs are yet to be felt by consumers. Increases in inflation will make growth more challenging still, which makes the importance of resilient businesses especially acute.

It’s easy for leadership teams to be caught up in the day-to-day operational issues, particularly when their organisations are taking their first steps into a new country. However, the ability to take a breath and look at the bigger picture shouldn’t be underestimated. Doing so allows the best chance of managing risk and turning the optimism reported in our survey into real, sustainable growth.  

Scaling technology for growth

Today’s businesses depend on robust technology infrastructure to support growth, whether that’s an SME taking on new hires or a multi-national enterprise planning expansion into new countries. Scaling digital infrastructure to enable international growth is high on our C-suite’s list of challenges.  

Modern international expansion is fundamentally enabled by cloud-first technology. Cloud infrastructure removes the need for physical data centres in each new country, allowing organisations to scale rapidly by implementing additional virtual capacity. Rather than having to source new physical infrastructure, book installations and integrate with existing platforms, cloud-based infrastructure provides major advantages in speed, cost efficiency, resilience and 24/7 availability. Major providers offer world-class backup, cyber protection and instant failover well beyond the in-house capability of most organisations. Cloud infrastructure removes the need for physical data centres in each new country, allowing organisations to scale rapidly by class backup, cyber protection and instant failover. Cloud infrastructure removes the need for physical data centres in each new country, allowing organisations to scale rapidly by providing world-class backup, cyber protection and instant failover

But cloud infrastructure isn’t without risk. Heavy dependence on hyper-scalers creates vulnerability: if a cloud provider goes down, all dependent businesses are affected and have limited ability to intervene. That can mean all but the largest customers may be limited to logging support tickets and waiting their turn.  

UK companies also have to carefully consider regulation and data residency. They should be able to demonstrate to the satisfaction of UK regulators that data stored in overseas data centres complies with legal requirements. It might be necessary to explicitly request EU or UK hosting.  

In a similar vein, the UK C-suite barometer shows that tech transformation is top of the agenda for a majority of UK companies. This could include creating more agile, resilient systems by transitioning from a legacy, on-premise set-up to cloud-based infrastructure. This isn’t a simple task. For larger organisations in particular, legacy systems are complex and often comprised of multiple systems which have been brought together over many years. Seamless IT transitions are fabled creatures indeed, but international growth can be a catalyst towards a digital estate which enables smoother scaling in multiple countries simultaneously.

Finally, a world-class technology stack is nothing without the people who need to use it. It’s often the case that people are largely forgotten while processes and technology receive all the attention. However, giving equal thought to upskilling teams to make best use of the new technology drives greater adoption, stronger resilience and ultimately better outcomes.

Putting into practice  

At its heart, business is about balancing ambition, opportunity and risk. International expansion is a priority for many businesses because the ambition for growth is often best-served by looking to new countries – larger markets, stable economies and sufficient access to people and technology contain many of the key ingredients to reap significant rewards.

By taking a strategic approach to the risks and challenges involved, the UK C-suite is well-positioned to turn its growth ambitions into reality.