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Starting a business in the Netherlands as a scale-up company
You have been able to read about the process to start a Dutch company in our Business Toolkit’s article; how to start a business in Netherlands.
In the article below we like to focus on the most important considerations when starting a company in the Netherlands as a scale-up. In case you are starting a company in the Netherlands, in order to expand your business, and grow your turnover, we speak of scaling up your business. (In general, we consider the ‘scale-up’ as a definition for companies that have grown their turnover (or FTE’s) with about 20%, of each of the last 3 years. Which could very well be your goal as a traditional SME company!)
When you are scaling up your activities, this means you are looking to expand to a market that will help you grow.
What are the advantages of setting up a business in The Netherlands for a scale-up company?
In order to scale-up your business, it’s all about infrastructure. You need the talent, the correct logistical process( & resources), access to funding, and a high potential market. All the while, not being affected by ridiculous bureaucracy and high taxes.
Whether you are in IT services, recruiting staff, or into trading (import and export) of goods, The Netherlands offers a great entrepreneurial climate for you to scale your business.
It’s very common for scaling companies to already have customers (or partners) in the region where they like to establish a company. You might have customers already in The Netherlands, or Germany, or even Belgium. Even if you only have customers in Germany and Belgium, it still makes perfect sense to consider the Netherlands to incorporate your company. In fact, we have assisted dozens of entrepreneurs to start a business in The Netherlands, after they first contacted us to know more about setting up a business in a country like Germany.
As a scale-up company that already experienced initial success, you are probably considering multiple countries to expand your business to. To explain why. The Netherlands is interesting, it might be good to provide you with a comparison with Germany.
Because an ‘entrepreneurial climate’ is a rather abstract definition, we can become more concrete when we look at the actual fact & figures of both countries.
Important to know as scale-up in the Netherlands
When you are planning to start a company in the Netherlands to enter the Dutch market or to use The Netherlands as a gateway to the rest of Europe, the following information can be useful for you:
#1 Finding a warehouse or logistics partner in a heartbeat
Finding the correct housing solutions in The Netherlands can be important for your business. Especially if you are involved in the trade of products. The Netherlands has a long history as logistics-hub, and as such, you can find thousands of professional logistic service providers in The Netherlands. The Netherlands is home to more distribution centres than anywhere else in Europe and has the largest inland shipping fleet in Europe. Finding a warehouse in The Netherlands is relatively easy, due to national online platforms( such as fundainbusiness.nl), and the assistance of government agencies and realtors. INCO Business Group can connect you to the right realtor or government agency with the right expertise. The Netherlands is a highly innovative country, and this is also visible at our logistics companies. Fully automated fulfilment services and professional tracking systems will allow you to run your business smoothly, and ensure that your customers will receive your products. Your dedicated company officer at INCO can help you to find a good solution, and can also negotiate with the owner/landlord, and deal with the (legal) formalities of renting a warehouse in The Netherlands (or dealing with a logistics partner).
In case your company is still in the startup phase, we can discuss the possibilities of handling your packages and shipments from INCO’s office in Breda. INCO handles logistics affairs over several European companies in THe Netherlands. You can read more about Housing in The Netherlands here.
#2 Finding great (multilingual) talent
In order to scale your business into the Netherlands, it can be very important to recruit staff in The Netherlands. The Netherlands offers scale-ups highly educated, skilled and English speaking talent, that is familiar in dealing in international business.
Although the salaries in The Netherlands are relatively high, compared to East and Southern Europe, very little time is lost to labor disputes. Aside from that, the Dutch staff provides a high return, due to it’s no 4 global ranking of its education and training system (WEF Global Competitiveness Index). As a whole, the cost of labour in The Netherlands is highly competitive.
Finding talent or staff in The Netherlands can be done via online job recruitment sites and Linkedin. There are numerous (online) recruiters which aim specifically on expats and international staff, in case you prefer a staff member that speaks your language.
Finding talent in The Netherlands is one of our Business Development services, and you can contact our team for more questions or assistance in this matter.
#3 Getting connected in your Industry
A business is not an island. This is particularly true for scale-ups that are entering a new market. Connecting with the Dutch industry, in which you are planning to be active, can be very useful. There are a lot of branch organisations and business associations in the Netherlands, which are happy to connect you to potential customers, producers or business partners. They might also be able to inform you about license requirements, or they can help you with how to cope with these license requirements. INCO can help you to get connected with industry leaders in The Netherlands.
#4 Great infrastructure; highways, railroads and world’s biggest sea- and airports
The Netherlands has a great infrastructure, which allows you to build an efficient business structure and supply chain. Even across borders into German, Belgium, and the United Kingdom, The Netherlands allows you to covers (parts of) these markets without having to enter these markets with physical representatives.
The great infrastructure of the Netherlands, allows businesses a smooth scale-up of their operations, while they don’t have to worry about logistical restrictions or delays. Or as Matt Althauser (General Manager of Optimizely EMEA) said:
“The number one reason we chose Amsterdam as our first location in Europe was its proximity to other markets. With Schiphol, we’re connected to our customers everywhere in EMEA, and there are daily flights back to our worldwide headquarters in San Francisco. That central location and the multilingual nature of the people here means that we can do business with anyone, anywhere.”
Aside from Optimizely, hundreds of multinationals have chosen to establish their operations in The Netherlands, due to the great infrastructure it has to offer.
#5 Low bureaucracy and administrative expenses (and taxes)
As an entrepreneur, there is no way around spending a lot of energy into affairs that are not part of your core business. This is especially true in case you would start a company in a highly bureaucratic country.
The costs of bureaucracy can be enormous, considering that it requires your personal attention as an entrepreneur. It’s important that you have a good understanding of the legal and tax system of a country because the potential liabilities could affect your company’s future. Entering a country, such as The Netherlands, which has relatively low bureaucracy, will allow you to have a smooth landing without spending a lot of time getting familiar with its local rules and regulations.
INCO Business Group has closed down its offices in Belgium (Antwerp) and Germany ( Dusseldorf) for the exact same reason. If there is a way of operating your business with low bureaucracy, why would you choose to do it otherwise? Most of our Belgium and German clients decided to move their office to The Netherlands, and therefore INCO Business Group also decided to focus on The Netherlands as the best gateway to Europe.
#6 A market with great potential
Disney recently launched its online channel especially in The Netherlands, before enrolling its service to other (EU) countries. Why the Netherlands? For global conglomerates seeking to test drive a new streaming service, this small country, in between Germany, Belgium and the North Sea, is almost ideal.
"We are small and densely populated and we have just around 7.5 million households in the whole country, so no matter how popular Disney+ is, Disney's servers won't get overloaded," says Sanne de Bruyckere, a market researcher with Dutch group Telecompaper. "And the technical infrastructure is great."
Broadband internet penetration in the Netherlands is 98 percent, compared to 82 percent in the U.S., meaning virtually everyone in the country could access and use the Disney+ trial.
And Disney(online streaming) is not the only company (industry) that recognises this potential of The Netherlands.
If you are offering a new type of service or product, the Netherlands is a very interesting test market for you, because of our liberal and open mindset.
This same mindset allows international companies to enter the market, without great difficulties. Potential Dutch customers or business partners typically speak English well and don’t hesitate to do business with an international organisation, which is relatively new in The Netherlands.
All these great facilities and opportunities are concentrated in a small (let’s say metropolitan) region. Which is why you could say; If I can’t make it in The Netherlands, I can’t make it anywhere…. Making the Netherlands the best country to test to global expansion strategy.
Checklist for starting a business as scale-up
To start a company in the Netherlands as a scale-up, you can consider the information that we have described in the article ‘How to start a company in the Netherlands’.
The article will describe in more detail that you can consider the following checklist:
Select the legal Entity
1. Consider the formation requirements & timeline
2. Decide on a trade Name
3. Consider the costs of registration
4. Get a full understanding of the legal and administrative requirements
5.Formation of the Company and registration at the Chamber of Commerce
6.Apply for Tax ID’s
What will it cost to start a Dutch business as a scale-up?
You can start a company in the Netherlands for a relatively small budget. The most cost-efficient setup would get you started for about 750 EUR, plus the monthly fees to cover your Flexi-desk (approx 50-100 EUR pm) and accounting fees (approx. 125 EUR per month, if your company is registered for VAT).
In case you decide to opt for the incorporation of a new legal entity, which will be registered for VAT, the budget for the first year of operation should be considered at around 5.000 EUR. Our team can help you to get a full cost estimation to register a Dutch business, based on your situation.
Why is INCO Business group the ideal partner for scale-ups?
INCO Business Group has a lot of experience with startups, and we have assisted hundreds of SME companies to expand overseas (as scale-ups). Via our cooperation with B. Amsterdam, we have assisted numerous of their Startup Visa entrepreneurs, and as a partner of Breda Startup Awards, we assist Dutch startups to grow overseas.
We are an all-round corporate partner, that can help you in both your business formation, as the development of your business from an operational point of view. INCO is one of the most reputable incorporation agents in THe Netherlands, and surely the best-connected incorporation agents. Via our ‘We Mean Business’ events, we can connect you to Industry leaders and government agencies.
For innovative startups that are expanding overseas, and entering a scale-up phase, we can offer mentoring services and connections to the Dutch start-up ecosystem.
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