Expanding Your Business To The EU - Practical Matters Part 2

In our previous article, we explored some of the practical matters you need to consider when stepping out into foreign markets, including the preparations required, updating your business plan, setting clear expansion goals and objectives, careful financial planning and the importance of building business partnerships and compliance to EU (European Union) Regulations. In this article, we will delve into the key aspects related to establishing a physical and digital presence in the EU, building a capable team, and effectively managing cross-cultural communication and remote work.

Covered in this article 

Establishing a Physical and Digital Presence 
Building Your Team 
Managing Cross-Cultural Communication and Collaboration
Getting Ready for Growth 

Establishing a Physical and Digital Presence 

Selecting Your Physical Location 

Expanding your business to the EU may require setting up a physical presence to facilitate business operations. This will involve considering physical location, accessibility and proximity to your target market and business partners. Access to markets, distribution routes, transport facilities and other infrastructure, as well as the local regulations of the area you choose for your EU offices, zoning laws and conditions of lease agreements, are critical. Before finalising the physical location of your business, make sure that you have covered all of the aspects of establishing your business’ physical presence.   

According to NordicHQ, it makes sense to establish your business in a country where there is a reasonable-sized market for your product or service. While Germany has the largest economy and population in the EU, other top countries with high GDP per capita are Ireland, the Netherlands, Luxembourg and Norway. The EU one-stop-shop (OSS) rules do however make it easier to do business from one central location, while still selling throughout the region without extensive administrative work involved. 

Going Online 

Many businesses are going the digital route instead, avoiding the costs of physical brick-and-mortar set-ups, and rather investing in online presence. If this is your preference, or if you want to combine your physical store with a strong digital presence, there are some specific points to consider. 

Developing a localised website that resonates with your EU audience, ensuring language compatibility, culturally appropriate content and compliance with EU data protection regulations such as GDPR, will all play a significant role in building trust in the market. Leveraging social media, online marketplaces and other digital platforms can help to expand your reach. 

According to McKinsey, digital adoption in Europe remains strong and companies should keep up with the pace of digital transformation. Europeans are engaging with twice as many industries digitally as they were prior to the pandemic outbreak. When compared to their counterparts, high digital adopters - those who connected digitally with more than seven industries - tended to be younger, reside in cities, have greater levels of education, and had more disposable income. Growing your business online can build your resilience by allowing access to new markets, improving efficiencies and enhancing decision-making. 

McKinsey’s third annual Digital Sentiment Survey in Europe revealed three specific areas for digital development: user experience, mobile and revenue-generating interactions. Poor user experience was indicated as a major pain point, highlighting the importance of providing an outstanding website user interface and design to ensure continued customer satisfaction. 

Mobile penetration in rural areas is high, which opens the way to increase your business’ market share if your site is optimised for mobile. Interestingly, the survey reflected that industries with higher mobile app utilisation as a primary brand contact channel tend to have a larger share of fully digital users. 

One area where your business can gain significantly is by increasing the number and quality of revenue-generating transactions. The survey showed that the majority of consumer digital transactions were service focused, such as checking product availability or tracking shipments. However, this did not mean increased revenue. By digitising more complex transactions such as insurance claims, and financial application processes, businesses are able to increase their revenue-generation capacity. 

Adapting Your Brand for the EU Market

To gain traction and build customer loyalty, you need to consider language and cultural nuances as well as market preferences. By localising your marketing campaigns, including your website content, product and service descriptions and customer support channels, you can ensure you have tailored messaging that aligns with EU values and market expectations.

This is where having a single source of truth, like HubSpot, for Customer Relationship Management, can play a key role. Using powerful software to seamlessly connect your data, teams and customers on one CRM platform can boost your expansion into your new chosen market. With its various hubs for  Marketing, Sales, Service, Content Management Software (CMS) and Operations, HubSpot also enables GDPR compliance.

Building Your Team 

To establish a strong EU presence, you may want to recruit local talent who possess market knowledge and understand the EU's business landscape. If you choose this option, you can contact EU-based recruitment agencies, professional networks and online job portals, to find suitable candidates. You will also need to invest in comprehensive training programs to align new hires with your business objectives and values.

An important aspect you need to cover is understanding Labour Laws and Worker Rights in the EU.  Compliance with these regulations is essential if you want to ensure a harmonious, law-abiding working environment. By familiarising yourself with local employment laws, working hours, minimum wages, vacation policies, and employee rights, and engaging legal advisors or HR experts, you can ensure compliance and reduce the risks involved in this part of your business expansion journey. 

If you choose to work remotely, you can leverage this flexibility to streamline your operations, reduce expenses and tap into a broader talent pool. Given technological advancements, some necessitated by the Covid-pandemic, remote work has now become the norm. By establishing efficient communication channels, providing your team with the necessary tools and resources, and implementing project management systems you can enable seamless remote collaboration across borders and time zones.

Managing Cross-Cultural Communication and Collaboration

Expanding your business into the EU will also expose you to working with diversity and different cultural backgrounds. An inclusive work environment where open dialogue, cultural awareness and diversity are celebrated can help build trust with your team, your business partners and your clients. Here is where insights from customer data can also give your business a boost.

At the same time, you need to manage costs and this is where outsourcing work to South Africa  can help you save. With an exchange rate in favour of EU customers, you can make use of an online service provider with offices in SA and connections to the EU to support your business while you concentrate on what you do best. 

Getting Ready for Growth 

In this series of articles, we have looked at the importance of understanding the EU market landscape, its complex regulatory environment and what you need to know about market segments, competitors, key industry sectors and opportunities for expanding your business. We also considered practical matters you need to explore such as data privacy, seeking legal advice, adjusting your business plan and establishing your physical and digital presence in the market. In the next article, we will focus on the importance of business process reviews and risk management in your cross-border business expansion.