Advice on Conducting International Business in the European Union ...

An Overview of the European Union

A company can spend a lot of time and resources training its? sales managers and salespeople and may have the finest sales team as far as domestic sales are concerned. ?However, selling in the USA is very different from selling in other countries and sales practices that are successful here can be disastrous if applied in other countries. Each region and each country within a particular geographic region present unique business cultures and etiquettes. One such region is the European Union.

There are 27 Member Countries currently with 4 candidate countries and 5 other potential candidates. In the 27 member countries, there are 24 languages spoken and business practices and etiquette are as numerous and diverse as these numbers would suggest.

The EU is less than half the size of the USA ? 1.67m sq mls versus 3.79m Sq mls ? but has over 1.5 times the population at 501m versus 308m according to the 2010 Censuses.

Selecting the Prime EU Markets for your Product(s)

As with any business decision, it depends on your product as to which Countries are the prime ones. For some products, the prime markets are not necessarily the largest or most populated. In 2010, the #1 and #2 European importers of Pharmaceutical Preparation Products from the USA were Germany and The Netherlands.

Germany is the size of Montana but its? population of 82.3 million, is the same as the top 3 populated US States, California, Texas and New York, combined ? April 2010 Census. The Netherlands (pop 16.6 million) is about half the size of South Carolina and nearly as populous as Florida, which is the 4^th most populated US State.

Obviously, companies entering the EU markets for the first time are not Pharmaceutical giants but the comparison I used can apply to other product families. `

How do you determine where to start?

Here are some guidelines to consider:

• Short list Countries you believe are the best potential markets and for which you don?t need localization, thereby reducing initial costs.
• Use US and local search engines to determine which of your competitors are established in the short-listed Countries.
• If you have European clients buying directly from you, ask them why they bought your product and if they would endorse it as part of your launch program in their Country. User endorsements can be a priceless marketing tool.
• If you don?t have anyone in your company with international experience, contract an International Business Consultant to help you with your sales & marketing efforts.
• Source and appoint Channel Partners and learn from them what works in their Country.

Start your European business adventure understanding what works for you in the USA, more than likely will not work abroad. Each Country has its? own business culture and etiquette and offers its? own unique challenge.

As you develop your business plans and marketing strategies, be sure to note what works in individual Countries so you can develop a sound Global strategy, knowing what can be incorporated as part of your overall strategy and what is unique to each Country.

The top 10 European Countries by Imports, based on data from the World Trade Organization and the International Trade Administration of the US Department of Commerce, are:

1. Germany
2. France
3. United Kingdom
4. Italy
5. The Netherlands
6. Spain
7. Belgium
8. Switzerland
9. Austria
10. Poland

Choose your Channel Partners well and acknowledge they will know what works in their Country. Encourage them to develop marketing plans and, if they advise that your product or marketing materials need localization, ask them if they would like to do it. In my experience, it makes them more invested in making sure you achieve success in their Country.

Establishing Your Channel Network in the European Union

By the time you are ready to implement your expansion into Europe, you will have determined those Countries in which your competitors are established, know which Countries will require localization of part or all of your product and have sourced and appointed the Channel Partners you believe will bring you success in their respective Countries/Regions.

Before you launch your product in the chosen Countries/Regions, please make sure you have given your Channel Partners sales and technical support training and satisfy yourself that they are ready to start their marketing campaigns and can at least provide first level support.

Initially, you will probably have to provide more detailed support and ongoing training to the Partners until they have reached a level where they are able to be virtually self sufficient. If you have chosen well, they will be an integral part of your sales and support teams and require the same level of management, ongoing training and guidance as your domestic sales and support teams.

Once you have given them an agreed period of time to develop their respective sales and marketing campaigns, you will set them monthly and/or quarterly sales targets. In line with this, they will provide you with sales reports and forecasts.

Many International Channel Partner agreements will include a base discount structure with incentives built in that reward performance with increased discounts. If having your products advertised in local media is important, you can also negotiate marketing incentives.

Remember your International Partners are sales motivated companies who want to grow and expand their businesses so giving them incentive to promote and sell your products is a win-win business position.? Many, like you, are Entrepreneurs and understand the processes required to be successful.

Lafayette International Business Consultants, LLC specializes in International Business and has trained and mentored sales teams in the USA, the EU and other Global locations. We work on the basis that it is as important for the salespeople in other Countries to understand the US business practices, cultures and etiquette as it is for the US salespeople to understand the business practices, cultures and etiquette of other Countries.

By adopting such an approach, we have found that the successful appointment and training of International Channel Partners leads to significant growth of International Markets for US Companies. The process is smoother and less problematic than when they go international without any help, mentoring or expertise.

I was born, raised and educated in the UK. I lived and worked in three European Countries before coming to the United States, where my business in now established. Lafayette International Business Consultants, LLC works with a network of International Specialists on all Continents, including three European based companies in Germany, Scandinavia and the UK. We have a network of Channel Partners in all major European Countries/Regions who have brought consistent and profitable business to many of our Clients.

For an initial free one hour consultation about expanding your business into the European Union (EU), contact me at: david.keenan@lafayette-consulting.com

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Tagged as: Business Etiquette, Channel Partners, EU, Europe, European Union, Global Expansion, International Business, international business development, International Cultures

Source: http://lafayette-consulting.com/2012/02/advice-on-conducting-international-business-in-the-european-union-eu/

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