Have you been considering expanding your business to Europe? If so, read this guide for tips on how to open or expand your business overseas.
Make sure that your skills as an entrepreneur are intact before expanding your business beyond your domestic markets. This includes:
- Selling skills
- Planning and time management
- Having excellent communication skills
- Customer relation skills
- Tech savviness
Expanding to Europe won’t magically transform your business if you don’t have the basics of commerce intact beforehand. In fact, you could do more harm to your overall business if you’ve neglected the basics. For instance, if your business does not have a dependable sales team in place, moving to Europe would only compound these problems, especially when local customs and language barriers begin to present themselves.
Do Your Research
Researching your business expansion to Europe takes more than just getting your passport and leasing a property. Whether you’re in the business of exporting goods to Europe or operating a freelance web design business, each country has its own formalities related to running a business — as well as the European Union’s rules for commerce between each country.
While it is beyond the scope of this article, there are governmental websites for each country that can answer your questions. For instance, do you know which country you’re responsible to pay taxes to (and how often)? To answer some of these questions, start with the EU’s website on foreign businesses operating within its borders.
Considering that Europe is experiencing some upheaval in the wake of Brexit and other nationalistic movements, your foreign business might not be readily accepted as it would in domestic markets. You’ll want to do a market analysis of potential competition, size of potential markets, target markets, and demographics of each country (and its regions) and so forth. Additionally, you’ll want to do a “mental dry-run,” where you go through the steps necessary to establish a physical presence in each country. For instance, do you know the availability of office space in Leipzig? What about the availability of qualified staff in Lisbon? Once you’ve established these as a baseline, you can consider whether expanding to Europe with a physical branch office is worth the time and effort.
Physical Presence Isn’t Necessary
If the previous topic seemed daunting to you and out of your organization’s reach, don’t be completely put-off. The truth is that developments in cloud computing (particularly VoIP, or “Voice over Internet Protocol”) have made business expansion efforts to global markets much more feasible. How? Through the development of virtual phone numbers.
Virtual phone numbers are a simple concept to understand:
When a virtual phone number is dialed by a caller, the call is instantly routed to another phone number (known as the “destination phone number”). This phone number is identical in usage and look to “normal” phone numbers. This means that if your business used UK virtual phone numbers you can open up access to those customers who choose to dial the phone number. Of course, this access is dependent on your marketing efforts, so you can use toll free numbers relating to each European country that you want to reach. Toll free numbers specific to each country (and powered by virtual phone numbers) are known as ITFS numbers. It is necessary to use ITFS numbers (short for “International Toll Free Service” numbers) to make calls toll free for European customers, as they will be charged long-distance fees or blocked by their service provider for toll free numbers relating to another country.
Understand the Cultural Differences
For those coming from a U.S.-based mindset, it’s important to understand that Europe isn’t as homogenous as the United States. This is, of course, relates to language, however, there are various differences that aren’t apparent if you’ve never had the opportunity to live in or visit those countries.
For instance, the way that Germans do business versus the Spanish is vastly different. Germans are extremely punctual when it comes to business dealings. The Spanish tend to be more relaxed and laid back. Now imagine scheduling an appointment with a client during those hours. Therefore, you have to tailor your approach with these differences in mind.
Taking Time Zones into Account
Europe is a large area that encompasses 4 different time zones. This includes the following:
- Canary Islands
- Faroe Islands
- United Kingdom
- Denmark (mainland)
- France (mainland)
- Spain (mainland)
- Ukraine (except Crimea, Luhansk, and Donetsk)
- Kaliningrad, Russia (on EET all year)
- Most of the European part of Russia
- Ukraine: Only Crimea, Luhansk, and Donetsk
This may seem like a no-brainer, but the truth is that you need to sync up how your business operates to accommodate European customers. This can mean using a different sales team to match when customers want to be reached. After all, 9:00 AM – 5:00 PM in New York (EST) is 2pm – 10pm in many parts of Europe.