The blog below is one in a series of 5 on internationalization of SMEs. It is written on a fictional case study and is linked to the storyline below.
Storyline
Stef (44) is founder and CEO of Soil Improvement Technologies B.V. in Foxhol (hereafter SIT). The company has grown over the last 5 years to become 1 of the 3 leading parties in the Netherlands involved in soil composition analysis in the agricultural sector. The company develops, assembles and sells test kits directly to customers (B2B only) in the Netherlands. These consist of agricultural and arable farms but also partly to professional fish ponds. SIT has 8 employees and realizes an annual turnover of € 1.2 million and a positive result after tax of € 75,000. Growth is leveling off and pressure on margins is growing. Stef is considering entering the foreign market. He spoke to two German distributors at the agricultural fair in Hardenberg who responded enthusiastically to SIT's SOILAN analysis kit. SOILAN was developed in-house and introduced to the Dutch market as of September. Because Stef speaks good German, Germany seems the perfect place to start selling SOILAN. SIT has a simple Web shop, where buyers can order products through personal access.
Find the Turkish NOM by Wim A,B., NOM FDI
That Stef! A real entrepreneur, as it turns out. And then it just so happens that "accidental" exporting takes such successful forms for SIT that Stef almost thinks out loud, "SHIT! How am I going to manage all that? Look, Germany in terms of exports is all still manageable in terms of distances. And the logistics to German buyers are pretty reliable. But that Turkey! An economic powerhouse, of course. A kind of "little China" in Europe's backyard. If the market for SOILAN there continues to grow as it is doing now, it will overtake the German market in no time and the growth potential there is many times greater than in Germany'.
A thousand and one questions
In short, all sorts of opportunities are presenting themselves for SIT. Opportunities that simultaneously present Stef with a lot of things he needs to start thinking about and investing time in. And time is scarce. Especially in such a situation where a lot of time is already lost in the daily worries of running a growing, exporting company.
And then having to investigate whether it pays to set up a business in faraway Turkey. And if so, where and how do you do that?A thousand and one questions loom large: what is a good location in relation to my market? Rent or buy a building? New construction or existing? What permits? How do I arrange the logistics? With whom can I possibly cooperate? Are there any existing distribution channels I can use? How do I get good staff? Subsidies? Etcetera, etcetera ...
The Tip
Pay attention, Stef! Here comes a tip: Like the NOM for the Northern Netherlands, there will also be a central or regional club in Turkey created to interest foreign investors in establishing a business in Turkey. This is because of the investment and employment it brings to the Turkish economy. In short, look for the Turkish NOM.
You can do this, for example, by googling "invest in Turkey" or inquiring about this at the Turkish Embassy in the Netherlands. This short search will undoubtedly lead you to the website of ISPAT (Investment Support and Promotion Agency of Turkey). This is the national, economic acquisition club of Turkey. These kinds of national organizations are part of the central government and usually fall within the Ministry of Economic Affairs. And they, in turn, work closely with the various regional development organizations in Turkey.
Free Advisor
Making contact with this type of organization is very low-key. You email or call the ISPAT with a brief introduction of yourself and your plans. And you then ask the question, "Help me find the best location for my plans in Turkey. In doing so, be clear from the outset what criteria will determine your choice of location. Your information and your questions will then undoubtedly reach an enthusiastic and professional project manager who will quickly start working with and for you. He or she will bring all relevant information, possible locations and valuable contacts to your attention that will give a good and reliable picture of the establishment possibilities and advantages in Turkey for SIT. Up to one or more visits to the country itself for which they will then organize so-called fact finding trips so that you will get to know the relevant regions and the interesting locations and contacts personally. And all this in a professional and efficient manner.
This type of organization has proven and continues to be a valuable, broad-based source of questions throughout the site investigation process. And what also makes it very approachable: 'It's all free of charge'! They are your free advisors, where you just have to keep realizing that their interest is to convince you, based on relevant and business arguments, to start realizing the SIT plans in Turkey.
How I know all this? I am such a free consultant myself ...
- Wim A,B.
- Project Manager Internationalization