As the World Cup hype draws to a close, it’s obvious that there’s a lot of money generated from such a massive event. It’s often claimed that international sporting events are good for the economy of the hosting nation for numerous reasons, but do any of those reasons involve global businesses?
The international expansion of business is always a challenging process – so to think international sporting events, such as the World Cup and Olympic Games, could help alleviate some of that pressure would be welcome news. This would be especially good news since we’re seeing a rise of international sporting events, as well as the number of viewers tuning into games around the world.
Hosting international games is a very expensive business since it requires the host country to improve their existing facilities and build new ones. For example, World Cup hosts must have at least eight modern stadiums. According to Bloomberg Business, Brazil spent an eye-watering total of $11bn hosting the World Cup back in 2014. So it’s a no-brainer that it is at least profitable for the host country, otherwise, they wouldn’t do it – and this has been well established, not least for the host’s tourism and hospitality sector.
Host countries become massive tourist destinations in the lead-up to, and during, international sporting events; pretty much as soon as the country wins its bid. As the country prepares for such an influx, there’s likely to be a lot of job creation in the entertainment, hospitality and dining industries. It can also lead to public transport improvements and the building of new transport and roads, as well as projects such as new public parks and shops.
Ultimately, the host country will inevitably have a massive boost to its local economy. Therefore, expanding your business abroad is likely to come with advantages if you have some operations in a country hosting international sporting events. All of the improvements a country makes to host international games are conducive to any business with a stake in the country: improved transport networks, better public facilities and a boost to the economy, to name a few.
This also means increased demand – for engineers, manufacturers, planners, etc. If your business operates in a host country, there will undoubtedly be more opportunities that stem from the vast projects that will be undertaken.
International sporting events can also help in building friendly international relations, which can be particularly conducive when you’re looking to take your business international.
Another factor to consider is that, while people tend to spend more money during massive sporting events, this boost can be short-lived. It’s only natural for spirits to return to normal in the weeks and months after the games are over – so your business might profit from a short-lived rise in activity, for example.
But ultimately, it’s never a bad idea to consider potential future hosts when expanding business overseas and deciding what countries to focus on. For expert advice on where to expand, your business may benefit from talking to experts, such as Galvin International, to figure out how your company can best expand internationally.
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