RICHARDbSCOTT

iCreating a European Subsidiary - Securing Anchor Customers

cesb

"How do we get into Europe?"

Market concentration, key clients, client location, generic strategy, cultural affinity, languages, etc. - all serve to answer some basic questions:

  • Where are our customers?
  • Do we need to be in Europe, or will OEMs and channel partners be optimal market routes?
  • What functions need to be in Europe?
  • What are the tax implications? How can we keep tax exposure to a minimum?
  • What should our pricing policy be?
  • How much will it cost - and how much will we earn?

RICHARDbSCOTT has assisted firms in establishing full-blown, operational mirrors of their domestic organisation here in Europe. In other cases, the right solution has simply been to create a European virtual office for the client.

__________________________________________

 

 

 

Case Study

This comms-focused managed services client is a market leader in the United States, with its headquarters in California.

Although attracted to the idea of extending their leadership to Europe, the company had concluded that without 'anchor' clients the investment required would be too risky.

How RICHARDbSCOTT Helped

The client required a European business strategy that kept investment to a minimum until significant guaranteed revenue was secured.

RICHARDbSCOTT pursued a two-pronged approach to secure European revenue for the client.

The first was to lever the company's US success to gain access to decision makers within the leading European firms that were the client's potential customers.

The second was to engage in fact-finding meetings with the client's existing American customers to determine if they might have ambitions to expand into Europe.

Results

Richard discovered that one of the client's more innovative domestic customers already had plans in progress to enter the UK market. By contracting with the client early, this customer was able to secure valuable influence on the development and functionality of the client's European service offering.

Richard also identified an incumbent Scandinavian telecoms operator who was actively looking for a managed service alternative to their outdated inhouse system. They appreciated the multi-service functionality that the client's offering introduced to Europe and became their first customer here.

The engagement continued for a further 18 months. During this time Richard established the company both legally and physically, and led the company's efforts to create a 35 staff subsidiary which provided sales, data centre, support and software development for European customers. Assistance included sales, technology management, financial management, and recruiting. Market share rapidly grew to 40% in the UK, in addition to securing three major operator customers in northern Europe.