The single major prerequisite needed to be a player in the relocations industry is a global reputation. It’s easier for someone who has a global reputation to get into the industry, than it is for someone who doesn’t. For instance, estate agents previously tried to expand into relocations, but failed because of a lack of skills in tax and immigration.
Leno de Ponte, associate director at Deloitte claims relocation companies are losing substantial market-share to accounting firms because of a lack of a global footprint. In fact, the very existence of a local industry is because the South African market is so small that international relocations firms, in the past, did not target Africa as a market.
“Our strength is that we have offices in 140 countries and the other big firms are the same,” says De Ponte. This was not work that accounting firms sought, but was in response to client needs: companies sending their staff abroad on assignment were concerned about paying double taxation.
“A company that has 135 000 staff may have 5 000 as permanent expatriates, who might not see their home country for 15 years as they circulate around the world. We started managing that from a tax perspective and because we have a global network and the systems in place, we gradually extended this involvement to work permits and immigration, and, most recently, to the actual relocation,” he says.
Deloitte outsources the physical transport of people and household goods to a joint venture partner, Elliott International. Some of the other firms have plans in place to do the same: Ernst & Young, KPMG and PricewaterhouseCoopers all have both tax and immigration services.
“Whereas we started in tax and have expanded into immigration, relocation firms started as brokerages doing house and school searches and orientation, and have expanded into the immigration side of relocation.”
Deloitte has taken it even further: having the work permit and tax expertise, it’s a simple matter to add the employee to the total service, so it also offers clients recruitment services through its 140 country offices around the globe.