Franchising in Europe

FRANCHISE ENTRY POINT EUROPE: START SMALL, GROW BIG: INVEST IN THE NETHERLANDS

April 1st is the start of the International Franchise Expo in DC, the largest franchise expo of the country. The expo provides various parallel programs of seminars and workshops with a variety of topics, including international opportunities to export your franchise model abroad, focusing e.g. on Colombia and Panama. That said, Western-Europe has been serving for decades as an excellent entry point for US franchise concepts, ranging from (good old) McDonalds to Domino’s, Miramax, UPS and Starbucks. Eastern- Europe created a lot of potential since the early ‘90s; especially the emerging countries that became part of the European Union, facilitating franchise concepts enter these markets through regional hubs in other EU member countries.

With the round up of the European International Franchise Expo in Paris (20th – 23rd of March), with over 450 exhibitors and an estimated 30.000 visitors, this is the most significant international franchise event in Europe. Presented as the international hub to Europe, foreign visibility is low, country guest of honor is Canada, is present with (only) five companies. Other non European franchisors present are for instance: Singapore (one, start up), Brazil (two, excluding the Embassy and service provider), Russia (three) and Tunisia (three). Well, what about the US you might wonder? US franchise companies are present with a total of six; this includes established franchisees like Subways and Hertz.

Market in Europe: However Europe proves to be a difficult continent, where a model proves successful in France, might lack the demand in for instance Poland. To expand your market within Europe, you need to take it step by step and re-assess your concept thoroughly, incorporating local inputs, cultural background and habits. Entering the European market, one needs a diverse market of consumers and/or businesses, with a stable business climate; familiar with a variety of franchise models in diverse sectors and of course, a demand for your concept.

Why the Netherlands? The Netherlands serves as an excellent gateway for US franchise concepts going global. A country where your concept gains muscle, utilizes the ‘hub’ position, in order to jump to other countries within the region. A competitive business climate, familiar with US business concepts in food, retail and services, ethnic diversified, international orientated (main trading partners are Germany, France, UK and Russia), good infrastructure and high level supply chain, all factors that will contribute to your growth in a competitive marketplace of over 495 million citizens in the European Union.

The diversity of its citizens makes The Netherlands a model to test sub concepts of your franchise to a diverse audience from the consumer to business to business market. The Dutch are internationally orientated; expanding via The Netherlands to larger markets as France, Germany, Poland etc is an easier step than from Germany to Spain for instance. Furthermore, the government provides a flexible tax policy for foreign entities establishing their European office in the country (did I mention IKEA, who’s global head office is in the beautiful town of Delft?).

US franchises still have many opportunities in the European market, taking into account new topics like renewable energy, creative industry, high-tech systems and materials and food industry. Take on the challenge of entering the European market, using The Netherlands as gateway to successful implementing your concept in the region.