Things You Need to Know Before Doing Business in Europe

When looking to expand your business into Europe, there are a few things you need to know before you begin. Europe’s economy may still be recovering from the crash of 2008, but economic activity in the region in most EU member countries have continued to rise, with imports growing to EUR1.7tn by recent calculations.

About Europe

Whilst countries in Southern Europe, like Spain and Italy, continue to struggle economically, the demand for technology remains high. Germany is doing well, and Eastern Europe is buoyant, with the Scandinavian countries also prospering, which opens doors to all businesses, companies, and retailers who want to do business on the continent.

As a bonus, many people you will meet speak English, though this should not be assumed. While business processes are similar, and contracts are reliable there are a few things you need to know before you begin to tout for business in Europe. Probably the most important is the same with any new business, which is the need to build relationships, have meetings, give presentations and make decisions with your European partners.

Your actions, behavior, and knowledge will establish your credibility and earn you respect and hopefully a deal in Europe. Here are some things you need to know that apply to each European country, even though each country is unique in many ways.

Take your time

Europeans generally prefer to allow plenty of time for debate, consideration of ideas, reflection, and processing, so that they get the best result. You will need flexibility in your schedule and patience, or you risk alienating potential business partners and losing any possible deal.

Money matters

Whilst many countries in Europe use the Euro currency, there are in fact 12 currencies used on the continent, and wherever you sell, customers will want to pay for goods and services in their local currency. Systems will need to be upgraded to accept multiple currencies, factoring in currency fluctuations, up to 10 percent in just a few days, potentially leading to rates moving against you from the time the order is taken, and the delivery made.

Local knowledge

Thorough market research into the targeted region is crucial. Demographic, cultural and economic factors vary from region to region, so you need to know if your product will appeal to the market and if so, how best to communicate with any of the 733 million consumers in Europe through marketing and through customer service.

Keep it formal

When on business in Europe, be prepared for formal greetings, handshakes and in some country’s kisses, even in business. Research proper etiquette for the countries you are visiting and if in doubt, have in mind that you should behave as though at a formal wedding of people you do not know very well. This also means dressing with elegance. Leave showy accessories and clothes at home. Keep things subtle and classic by wearing dark or neutral colors with quality leather shoes, bags, and watches.

Buy local

Buying into local businesses, or at least hiring locals, smooths the transition into the market as it makes you less of an outsider. Employing local managers with knowledge and experience in your product market will offer insights into business behavior that can give you a competitive edge.

Education is admired

European’s are more impressed by your knowledge than the fact that you have contact details of a celebrity on your phone. How much you know about the world, historically significant events and current affairs will be taken into consideration when potential business partners are meeting with you. In Europe, this means being seen as well-educated, intellectual and able to discuss topical news. All of this may have no relevance to your business deal, but it can leave a good impression.

Amazon/eBay integration

One way to do business in Europe without having to set foot on the continent is to integrate Amazon and/or eBay into multi-channel retail operations. Amazon has 112 million active users (traders) and 233 million buyers worldwide, with 10 localized websites serving the Americas, Europe, and Asia. Integration allows retailers access to an international user base without having to develop localized websites for multiple international markets. This dramatically reduces development, running costs and time to market. There are downsides to this: managing inventory across multiple channels can be difficult and may need to be done manually, which is labor intensive and prone to human error. There is no way on either platform to automate order fulfillment with your own stock control system.

Mobile integration as standard

Smartphones and tablets are becoming increasingly important for online retailers as customers choose to shop at any time, at any place, at their own convenience. Mobile shopping, or m-commerce, currently accounts for more than one-quarter of all online revenue, and as this figure grows, sites should be set up to be mobile friendly.

Beware bureaucracy

Some countries in Europe, including Italy and France, are extremely bureaucratic or have complex processes for those wanting to trade. Having a local contact who understands the system can sometimes help expedite the process. Also be aware that different local offices may have different rules in relation to taxes, company registration, employment, planning regulations as well as import and export.

Quality translations

The quality of your communication can make or break any European deal. Do not assume that everyone speaks English, and even if they do, research shows that messages in the native language are more engaging than those in English. Use a good translation firm and ask native speakers to do a final check before sending.

Meal deals

In Europe, business often takes place over a meal. This is a chance for you to build relationships and trust. A chance for everyone to assess the business opportunity being offered and you, the person fronting that business. You will find that many deals can be made over a meal, along with a toast of Santé! Prost or Na zdrowie.