Trade, Distribution & Logistics
With scenic views and enthralling beauty, Netherlands encourages amassing support for potential investors and business partners. The country is situated in the northwestern sphere of the European continent. A pleasing and calming atmosphere is a suitable space for the growth of the mind and of one’s business. The country and the ambiance it provides eventually is the best for the expansion of the business in Netherlands.
The Advantages to register your branch in the Netherlands
1. Great Connectivity: The Netherlands being a country in association with the European Union, enjoys relative exposure with other European countries with much easier access. It provides fantastic options at relation-building and, thus, benefitting the business with its access to 95% of the markets in the whole of the continent. With its strategic location, it attracts tourists, business partners, students, to name a few people. Netherlands enjoys the title of being the fourth amongst the countries optimal for doing business with a 2.9% GDP Growth, according to Forbes. The lucrative location also is able in the generation of the favors of the American and Asian markets.
2. Beneficial Tax Rates: Adding to the prior advantage is the inclusion of competitive tax rates which favors the foreign investors. The standard Corporate Income Tax (CIT) has fallen from 25% in the year 2019 to 20.5% in 2021. It is expected to decrease further. There are only two income brackets which are set upon the corporations with the lower rate being 20%, 200,000 EUR.
3. Supporter of Innovations: The government of the Netherlands encourages the inventions of novel technologies by making the relationship between the private and public sectors strong. The businesses enjoy support with the placement of a well-established framework to counteract any hurdle or problems faced. Complimentary to the support is also the open-mindedness of the individuals running the country. The presence of acceptance of different ideas is well treated.
4. Excellent Workforce: the Netherlands has a large talent pool which should be applied while establishing the business. Having locals employed to cement the business in the economic structure of a foreign country. The literacy rate in the country amounts to 99%. With such a highly educated workforce, the business can easily flourish. The region has highly skilled engineers and professionals from all fields. With the country attracting students, it is quite simple to ascend the ladder of economic gains.
The Disadvantages
1. Neutral traders: The Dutch are famously coined as “Neutral Traders” as they favor the European or local enterprises over foreign ones, mostly. In order to combat this situation, a foreign investing business ought to make strong relations with any European or Dutch enterprise; having a strong local establishment helps to win the favors of the government quite easily. Thus, the establishment of an alien organization with no support from its local counterparts can be detrimental.
2. Difficulty in availing of permits: Acquiring construction permits from the government of the country can be a hassle. Constructing a warehouse in the Netherlands requires thirteen grueling steps alone. These many steps amount to a hundred and sixty-one days from filing for the permit and, possibly, getting one. Moreover, having different specialized tools, regular alerts, and check-ups of the soil and the conditions of the environment around can be obstructive.
3. Difficulty in fitting in the Netherlands is an entire country boasting its culture. Starting a business from a different cultural background can prove to be challenging. The fear of cultural appropriation and disrespect runs high. Henceforth, caution ought to be taken.
The country of the Netherlands provides support and encouragement for foreign investors for the establishment of a branch or initiating a business. The Dutch are welcoming in their demeanor towards new set-ups and innovation. The branch managers will get approval and aid in the acquisition of the necessary requirements.
The market favors the businesses with their suitable locations and low corporate taxes. With well-established connections with the most profitable markets of America, Asia, and Europe, the business will be cost-effective. The revenues generated will be profitable.
However, difficulty in the accessibility of the construction permit, trade barriers, and possible cultural differences need to be taken care of for the business to flourish.
Hence, strategizing the plan for optimum growth and sticking with it will ultimately yield the desired results. For a successful venture, the participation of every member is necessary, and above all is the active involvement of the leader. The Netherlands welcomes all daring and friendly to initiate their businesses with the country.
Azhar Ansari is a company formation specialist with 8+ years of expertise in international business. Financial planning, risk management, and other related areas.
