starting a business in the usa naf breakfast. next previous introduction marcel birkhoff – 38yr,...
TRANSCRIPT
Starting a business in the USA
NAF Breakfast
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Introduction
Marcel Birkhoff – 38yr, married and a daughter
Business/Marketing & technical background,MBA Marketing management
13 years with Hyva on international business development – pioneering new markets
Moved in 2005 to USA & Since 2005 managing director of Hyva Corporation
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Contents:
Company History & activitiesOur move to the USAMain prerequisites Main obstaclesCultural differences!Long term <-> short termSurprisesMain tax implicationsMain Lessons & conclusionsQuestions
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The Hyva Group
From a tiny spot on the map in 1979…
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… to a world leading company in 2008 …
Hyva moves your world!
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Companies everywhere in the world
Technamics B.V. Hyva China
Hyva India Hyva altatec Australia
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In 29 years Hyva reached
Export to more than 130 countries
28 fully owned subsidiaries
2000 employees
Sales of 135.000 telescopic cylinders (2007)
Sales of 15.000 tipper bodies per year (India)
Sales of 2.500 Hyvalift systems (2007)
Turnover of € 475 mio in 2007
Expected turnover of € 600 mio in 2008…
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Hyva is producer of
Hydraulic telescopic cylinders
Hydraulic truck kits
Hyva Lift container (un)loading systems
Hyva Floor horizontal (un)loading floors
Truck mounted cranes
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Hyva on USA dumptrailer
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hydraulic kits super structures all necessary components
Hyva Hydraulics
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Major drivers of our business
GDP development of countries
Infrastructural investments & projects
Mining & heavy off road tipping applications
Environmental developments
Developments of labour costs
Sales numbers of trucks & trailers
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Our move to the USA
Started from Chicago apartment in beginning 2005Company founded in end of 2005“Corporation” as legal entity, registered in DelawareMain office in Chicago, with various satellite
warehousesUsd. 6 mio Estimated sales - 2008Market-scope is US and CanadaCurrently serious market decline in USAConstant growth – increasing market shareHyva has far more modern & efficient product
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Prerequisites to enter NA
Safeguard yourself against currency fluctuations risks
Investigate product liability risk
Structure the company in such a way that parent company can not be touched
Have patience and full stakeholder support
Local presence & fast product availability
Product offering must have an competitive edge
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Main obstacles
Geographic size & regionalismDifference in technology & market standardsDifferent customer expectationsNot “Made in USA”Liability issuesDifferent laws & regulations on company and
employeesReluctance to deal with foreign companies Don’t fall for the transatlantic trap!
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Transatlantic vicious cycle
Reconfirmation of the American’s Concern
about European Commitment
Entry
American Concern Regarding priorities / US Commitment of the
European
Withdrawal of the
European from the USA
Refusal to Purchase
Due to Perception of
Lack of commitment
Disappointment
of the European
Investment limit reached
Product introduction
Positive initial response
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Cultural differences
There is a bigger culture difference than most people think
US customer is polite, and does not say no
Dutch people can be perceived as too direct and pushy
Intercultural training definitely helps!
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Short term<-> Long term
US is short term focused, NL long term
This emerges in different areas:- Economy has higher highs & lower lows- Quality & technical sophistication is less important- Lower price is more important then lower cost- Shorter timeframe on ROI’s- More importance on short term shareholder value- The dollar is paramount!
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Surprises
US customers generally perceive European products as superior – nice!
Banking system old fashioned and inefficient in Dutch view – majority payments with checks
Certain industries very low tech, others very high techLower environmental awareness & concernsMore bureaucracy than you expectVISA application process not so easy anymoreCanadian market presence eases introduction in US
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Tax issues
Consider international transfer pricing rules
Consider federal tax and state tax
Sales in different states = paying tax in different states
You need good local advise and global tax strategy
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Lessons & conclusions
Do not underestimate geographic size Setting up takes 3x longer and cost 3x more as in
business plan!Good preparation on all fronts is keyCover your self against currency/liability risksFocus on long term and be patientSustained local presence is key in breaking the
transatlantic vicious cycle
If you succeed the rewards are great!
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Thank you for your attention!
Any questions?