For American-based companies looking to expand into the European marketplace, choosing the right partner abroad can help your transition run more smoothly, efficiently and cost-effectively.
There are many factors to consider, including potential language barriers, corporate tax rates, political climates, workforce allocation issues and cultural differences. An experienced and reputable European partner can help you navigate these difficult challenges, but you first must perform your due diligence.
For example, if the primary objective of the U.S.-based company is simply to expand into the European Union, then the number of available partnerships currently spans some 28 different nations. With so many options available, why not start with the basics?
Ireland might be a quality choice in your search for a European partner because of the common native language and lower corporate tax rates. As the expansion begins to take hold over time, the Irish partnership can serve as a gateway to the rest of Europe. While this is only one of many available options, the American-based business must first clearly define its desired expectations to be achieved through the collaboration with a European company.
Partnerships for European IT implementation
Some companies looking to expand into the European Union may benefit from a partnership with expertise in VAT issues while others might be searching for assistance in building brand name awareness abroad. Or perhaps the U.S. company needs someone with skills in supply chain economics?
There will be issues of attracting and hiring the best possible technical staff, training them, and keeping them motivated based on the cultural differences in workplace etiquette. Even the allocation of equipment in your new European country can be problematic if the American business has no pre-established professional relationships with EU vendors.
Before beginning your search for the perfect European partnership, make a detailed list of your goals and objectives. Then start investigating potential candidates by considering the following factors.
- Referrals: As a foreign entity in a strange country, your company’s future collaboration with a well-connected European partner will open many doors. The European partner can instill a greater sense of confidence, trust, reliability, and professionalism with potential clients and customers. And perhaps most importantly, the right European partner can help you attract top talent at the best prices and in a timely manner.
- Joint promotions: If the partnership candidate has had successful collaborations with American-based businesses in the past, review and evaluate the success of their previous joint promotional campaigns. Joint promotions are a great way to build brand name awareness, instill consumer confidence, and save advertising costs. However, partnering with the wrong European company can produce potentially devastating consequences, too. Due diligence is key.
- Better pricing: If the U.S.-based business anticipates launching product lines with slightly higher price points than its EU competitors, the right European partner can help overcome the challenges associated with these more aggressive pricing strategies. Just like in America, Europeans are very willing to pay more for a higher quality product. But they first need to be able to find them. The right partner can use its international “clout” to promote and recommend your higher-priced products to a specifically targeted EU demographic.
- Local laws and rebates: Successful partnerships with European organizations can assist with VAT issues, compliance requirements and the procurement of equipment. They can save the American-based business enormous amounts of needless additional expense in start-up costs, shipping and delivery fees, and even sales tax thanks to EU rebate opportunities.
- Faster, more efficient expansion: Using the previous example of starting your EU expansion in Ireland, the right partner can help the U.S.-based business expand throughout the rest of the EU more quickly, efficiently and cost-effectively, too.
Locating the right partner for your European IT implementation will take time, energy and patience. Performing due diligence to investigate potential candidates for histories of security breaches, service disruptions and previous collaborations with international companies will also be crucial. However, with a little hard work, your American-based business will gain valuable insights and expertise to make your EU expansion highly profitable over the long term.