Guest post by Cristian Dorobantescu.
With the current financial turmoil and investors pulling up quick on the US stock markets some eyes are turning towards investments abroad. The simple reason is that economies that are not very connected to the US economy or are just in a plain growing period, feel the US crisis in a somehow filtered way.
Of course, if we are talking about Europe, well, Europe is clearly connected to the US market. And we have a saying here, if US sneezes, Europe will cough. Still, Europe and mainly Eastern Europe is not affected in such a radical way as US, partially because the European Union took drastic measures to limit the impact. If you add to this a partially similar Western culture, then investing in Europe might not be a very bad decision.
Now, before you take your backpack and start to hike in Europe looking for business or investments opportunities hold your horses until you learn something about doing business over here. That’s why I’ve decided to skip the part with why it would be a good idea to invest in Europe (or even better in Eastern Europe) and just talk about the differences, or at least a few of them.
To start, while European Union puts together most of the European Countries, just like US does on the American Continent, each country in the EU behaves differently.
- Each country speaks a different language. While English is the de facto business language for the consumer markets you should localize whatever you are selling, and let me tell you, we are talking about at least 6 major languages.
- European Union has put in place a common legislation, but each country has it’s own set of rules. Moreover, the European Legislation tends to be a little more restrictive and sometimes there are more regulations to follow.
- Consumer behavior is very different from country to country. Depending on what country are you putting your foot in, demand, pricing and overall acceptance of a product might be totally different. For example, Germany could be a good choice for expensive products. Greece works better with cheaper products.
- European Union provides several sorts of funding to sustain parts of the economy. There are several programs to sustain small businesses and even programs in which a certain EU country is supposed to receive funds from another country.
- As an opposite current, Venture Capitalists, Angel Investors are not so widely spread. Sometimes Europe can be less entrepreneurial.
On a more generic note there are other things to take into consideration as well.
- Not every US product or service is suitable for selling in Europe. For some, just the shipping cost to Europe ads to the product price more than the market could accept. For others, the products simply don’t fit with the demand (like for example it would be quite impossible to sell big SUV in Europe because the streets, roads and distances are much smaller)
- Lots of cultural differences. While Europe belongs to the Western culture, things over here can be completely different. For example, people pay a lot more deal of attention on heritage, history and nationality.
There are a lot more differences to talk about, and obviously more than I could cover on this blog post. So what should you do next? My experience in blogging about local economies taught me the following: you should get a glimpse on doing business in Europe from statistics. http://www.doingbusiness.org/ does an excellent job on showing valuable statistics on the business everywhere. Then you should get a glimpse of the real life business environment from business blogs. After that, take your backpack and see for yourself.
Cristian Dorobantescu is a strategic expert with experience in small business development and entrepreneurship, delivering successful out-of-the-box initiatives. His special interest in business development processes helps him establish a strong and personal relation with companies willing to create a successful business model in Europe. The efficient entrepreneurial speech and the result oriented approach gives him the ability to surpass the European cultural differences.
He previously worked on distribution channel development, sales and marketing, company branding and client relations for International companies.
He enjoys writing the Small Business Entrepreneur blog (www.energybyte.com) and the Entrepreneur interviews blog. (www.entrepreneur-interviews.com)
Tags: business, cristian dorobantescu, europe, european union
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