Considered to be one of the most powerful economies of the world, the Euro-zone continues its promising performance and it has even outpaced its 1.6 percent Gross Domestic Product across the Atlantic. With this excellent feat, it is not a surprise that it exists as a desirable arena for business. Here are some of the important things to know before having a venture started in Europe.
Beginning of a Venture
In building a new business in Europe, one must primarily consider the location. The number of countries to choose from can be very complicated, and even highly confusing. This is because Europe is different from the United States of America when it comes to VAT rates, taxes, registration procedures, minimum capital required and, even language.
Understanding the Requirements
Most entrepreneurs commit mistakes by basing their decisions to only one requirement, as in taxation. Although some may appear as enticing area of business, it becomes a hindrance when local legislation, labor and funding market issues arise. This can pose great impact to the success of one’s business. It is very pragmatic to understand each and every requirement to make sure the chosen country is the best among the choices.
Finding the Best Day to Begin A Business
It is an important consideration to find out how much time it will take to have a business set up completely. Other European countries are known for their bureaucracy, and red tape, while some encourage overseas investments which makes it very easy to open a new business. For instance, according to World Bank, Austria ranked 21st among countries worldwide for ease access for business. However, it may take about 22 business days to finish the process, and this can often deter some entrepreneurs who may not be an entirely appropriate fit.
Registering for a Trademark
This is the most valuable step to protect your name and make it easier to start a brand which promotes good reputation of credibility and quality. Each country in Europe has their specific registration process. However, the Community Trademark or CTM provides protection across all member states of the European Union through one application process only. This reduces the administration and cost as compared to applying individually from one country at a time.
Knowing Customers and Suppliers
European countries have their own specific specialization when it comes to industries. London, Berlin, and Paris thrives with technology, thus, it is not surprising to see that awareness of e cigarette starter kit as a tobacco harm reduction product in Europe has risen to 93 percent. While in Eastern countries like Czech Republic and Poland, the lowest manufacturing costs is offered, so it may be a good area to open a business that requires such. It will also be a smart move to make time for local market research and competition, including potential customer base which may aid to the decision making process.
Asking the Vital Questions
Before you begin a business venture in Europe, it is important to find the answers to questions like where you can you find the majority of customers, what are your shipping needs and do you have a clear insight of them, and also what your VAT rates are.
Determining VAT rates
The VAT rates vary in different countries belonging to the European Union costs at a minimum of 15 percent. These 28 countries have a freedom to set their Standard VAT rates, with maximum of two reduced rates on a minimum of 5 percent. Even the length of time for VAT registration can vary from one country to another. Within the United Kingdom, it may take about 14 days to acquire the VAT registration certificate.
It is both a privilege and responsibility to be able to open a business in Europe. Therefore, it is very important to find and master the aspects which will help determine the country where the business will thrive and develop. Good understanding of such elements will impact success by serving as aid in making the best decision right from the very beginning of your venture.
By: Jennifer Livingston