Nxgen International is opening operations in the United Kingdom and Italy as part of a European expansion strategy the Whitefish, Mont.-based merchant-service provider announced this week. Diversifying geographically can help Nxgen grow and differentiate itself further, says Giuseppe Caltabiano, Nxgen president.
Nxgen intends to begin boarding UK merchants in late March and begin operations in Italy two to three months later, says Caltabiano. Nxgen has incorporated Nxgen UK and Nxgen Italia and will have offices in Chesham in the UK and likely in Milan and Rome in Italy, he says.
The company intends to work with local partners in both regions and use local salespeople to reach merchants. Nxgen is working with UK-based payment-service provider SilverPay and an undisclosed partner in Italy that is a “major vendor of payments systems” in the market, says Caltabiano.
Nxgen’s strategy is “act local and think global,” says Caltabiano. The company finds local partners that would benefit from partnering with Nxgen so the two companies together can offer a full range of payment products and services, he says.
Nxgen first began its international expansion in Canada in 2006 with Nxgen Canada.
Expanding into multiple geographic markets can benefit a company by spreading its revenue among different currencies and regions, says Caltabiano. “If all of a sudden a country goes into a [economic] crisis, hopefully another country isn’t going into the same crisis at the same time,” he says. “And if a currency goes lower, hopefully another will go higher.”
Though global expansion will not serve every company, “real truth” exists in the financial benefits of diversifying business geographically, says Cliff Gray, an associate and merchant-processing and product-services expert with The Strawhecker Group, an Omaha, Neb.-based consulting firm. “As the global marketplace matures, it will become more and more common,” he says.
The U.S. merchant market also is quite saturated with card services, and some providers may look internationally to find untapped areas, says Gray. “A lot of people have to be thinking there is more business out there on the other side of the pond,” he says. “In the U.S. especially, it’s very saturated.”
