Market footprint slideshare_april2012

Expanding your
business into Europe

http://www.market-footprint.co.uk
Expanding Internationally
The United Kingdom is a popular launch point
for international expansion in Europe because
of the favourable economic climate for business
and because English is the language of
business
However the start-up sales costs for your land-
and-expand venture can be high

What shape do you want?
● Deciding what form you want your business to
take in Europe can be complex
● Limited company?
● Sole representative?
● Contracted out?
● A lot depends on whether the contract with your
customers will be with the local entity or with
the parent organization

Sole representative
● A popular choice is to send a senior individual
from your company to the UK under the sole
representative visa scheme. This will cost you
around $450 for the visa plus lots of paperwork.
● You then have the subsistence costs for the
employee. If the employee is in London then
allow $20,000 pa for a basic apartment +
$20,000 for additional costs such as furnishings,
deposits, local property taxes, utility bills etc
● Sending someone you trust is a low risk route
but do not under estimate the cost of employee
accomodation, per diems, office space etc

UK employment
● For high tech businesses, employing a local
sales guy is a good route. They have the
contacts and relationships with prospective
customers and they know the market.
● BUT unless you know someone already, you
need to spend money finding the right person
and feel confident you have found the right
person for the job
● Your first international employee needs to be
senior enough to be proactive and work without
supervizion.

What it costs?
● A good caliber, senior technology sales guy in
the UK for your international organization will
not come cheap.
● They will expect a basic salary of at least
£85,000 pa ($130,000) and assuming they
achieve their sale target will expect to be OTE
£150-250k
● What are the other hidden costs?
● UK National Insurance for employers is 13%.
● They will need a car, office etc

The hidden costs
● UK national insurance is a tax employers have
to pay in addition to the employees salary. This
tax is for social provision.
● Assuming you pay your top guy £85,000 salary
then the National Insurance contribution in
addition to this will be an additional £15,731per
year. If they achieve their on-target earnings of
say £180,000, be prepared for the NI
contribution to be £30,744.
● If they dont achieve any sales in year 1 then the
employee will cost you £100,731 + expenses

More hidden costs
● Unless you know the perfect UK sales guy, then
you will need to engage a recruitment agent.
Expect to pay 25% of the first year salary to the
agent for the recruitment fee. Assuming again
£85,000 basic salary, then expect to pay
£21,000 ($33,150) to the recruiter.
● Your first year costs for your new employee are
now £121,731 before the first sale.
● It is common practice to provide a car or car
allowance. Allow £500 per month = £6,000pa

Office Space costs
● Providing office space for your employee is
another additional cost.
● Serviced offices are the best choice on day-1
since you want your expensive sale guy to be
selling not setting up an office.
● For London, expect to pay at least £500 per
person per month for serviced office space -
£6,000 per year ($9,400)
●

The real cost
● Your first guy on the ground is going to cost you
at least $200,000 before you get a sale.
● If it doesn't work out, expect to pay $20-40,000
for severance costs too.
● What are your options to reduce costs and still
get great results?
● Outsourced sales is a cost effective way to test
the market with low risk. You are not employing
an employee but a company providing a
service.

What we do
Market Footprint provides outsourced B2B sales
and business development for international high
tech firms entering the UK and western Europe.
We specialise in selling complex, high value
products and services into the telecom and
financial services sectors.
We build your sales footprint.

Our Ideal Client Profile
● Our clients are:
● High tech companies
– – ideally telecom or financial services
● Operating in a B2B context
● Based in technology hotspots eg Israel, California
● Established start-ups or expanding businesses
● Unique or disruptive product/service offering

Our Approach & Philosophy
● Business is about relationships and trust
● We build long term relationships with customers
● We sell what is right for the customer
● Products & services must match our values

The Value We Bring To You
● Rapid start-up
● Experienced, high caliber staff representing
your company with a professional image
● Low risk option of test the water approach
● 3-6 month trial engagement to confirm viability
● Results based engagement
● Typical engagement costs of just £5k/month
retainer + commission on results
● No start-up overheads such as office space

How do we do it cheaper?
● Sales can involve lots of dead-time such as
waiting for prospects to organise meetings,
particularly in the early stages of engagement.
● Our sales professionals cover 2-3 clients
allowing more efficient use of their time.
● Fixed business costs are spread across
multiple clients giving you access to high
caliber staff for a fraction of the cost.

What next?
● If your business provides high tech products or
services for the telecom or financial services
sector, we would be delighted to discuss your
international expansion plans and show you
how we can help you successfully expand.
● New business contacts:
● UK: Steve Roberts +44-7887-852-920
● Israel: Motti Gejbrowitz +972-546-682-600

Market footprint slideshare_april2012

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Market footprint slideshare_april2012