J2G What should an Anglophone know about doing business on the continent?
The first thing to know is that personal relationships are far more important than in the US and the UK – at every stage, and at every level. It’s not quite Japan, but personal relationships are a big part of the way things work here. It’s not always the best price that’s most important – or even the best service or product – but often who you know, and how you can parlay relationships into doing business.
English-speakers might enter this market with the idea they have a unique product to offer, or the best pricing, and they’ll assume success will come easily to them. But what they really need to do is to make a real connection with a competent local partner who knows the lay of the land.
J2G What are the particular challenges that face a foreigner in trying to set up a new venture on the continent?
The first big challenge for many people is understanding the business culture and mustering the effort and enthusiasm to learn the culture and become adept at maneuvering in it. If you arrive here thinking, as many young British and French expatriates do, that Belgium is boring or easy or that nothing’s going on here, you’re not going to get anywhere. You need to say to yourself: ‘This is the market I’m going for. I’m interested. I’m enthusiastic about getting involved with it.”
You need to want to understand. You need to want to make an effort. You can’t expect things to land on your plate because you’re a hotshot in New York or London or Paris. You need to be curious, adaptable, motivated.
If you’ve managed to get that right, the next challenge is going to be the red tape.
From a North American perspective, the bureaucratic and tax loads are quite heavy. Understanding how to handle the bureaucracy is the most important of the two. Get yourself an excellent local accountant. Have access to an excellent and well-connected local lawyer. Be prepared to put in the necessary time with municipal and tax authorities. Don’t avoid it. Plan for it.
You need to think about where and how to incorporate. Are you going to be a branch office? A limited liability corporation? Offshore or onshore? A non-profit? An international non-profit? An SA? If you’re an organization with employees who are not EU citizens, you’ll have to deal with living and working permits for them.
These things will take up a significant amount of time and will require a financial commitment – mainly to your lawyer. You need to get it right the first time, and you can’t do it on your own – if you fail because you decided to do it without professional help, you’re sunk.
The cost of employment in Belgium is higher than in many countries, owing to the excellent social welfare provisions. Protection of employees is very strong, so firing an be a costly proposition. As a result, you need to be more careful about hiring.
Some major corporations aren’t hiring any longer in expensive countries. They’re relying on interim in-sourcing companies that provide high-level temps or consultants in order to ensure they get the right skills… without having to make a commitment for decades.
J2G What was your first job in Brussels?
I first came to Brussels from the German Parliament in Bonn to work as an intern in the European Commission. My first real job in Brussels was as a lobbyist for the electronics industry. I was hired to start a branch office of a major US trade association, bring in clients and make it profitable as soon as possible – and along the way, to influence European policies that affected the IT industry. This EU-focused path is a fairly common route for young expatriates who come to Brussels. Opening someone else’s branch office is a relatively secure way of entering the scene and learning the lay of the land. Now, I’m based in the US, but do a lot of business with European – and particularly Belgian – customers and suppliers.