Fryslan House
Published on 19 July 2018
Netherlands
Friesland (NL)
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About this good practice
By opening a shared office in New York (Manahattan) and Riga (Latvia) we have assisted 15 SME companies to start their business activity in the US and Latvia (Baltics). The office forms a spearhead or springboard for companies to have permanent residence in another city and a representative (agent) included. We have searched for Dutch nationals in the the US and Latvia and found people with a relation to the local business community, acting as an agent and running an office. We have contracted them as host organisation and started looking for Frisian companies willing to built up a position in these countries, but lacked time and funding to be active on that market by theirselves. The companies are member of the Fryslan House and pay a yearly contribution. In return they can use the address in Riga and New York as a communication address and also meeting address.
The reason for the selection of Riga and New York was the following. For Riga, we have evaluated the growth ambitions of the Baltic States, a trade region for the Norhern Netherlands with original roots. There is good chance to find a stepping stone contact in that region for doing business in Russia. We found a original Frisian person, working in Riga to represent our model. That is why we choose Riga as base. For the US, the initial demand was from the regional Frisian government to join the 400 year relationship between New York and Friesland. The Fryslan House model provided the perfect business match for it.
The reason for the selection of Riga and New York was the following. For Riga, we have evaluated the growth ambitions of the Baltic States, a trade region for the Norhern Netherlands with original roots. There is good chance to find a stepping stone contact in that region for doing business in Russia. We found a original Frisian person, working in Riga to represent our model. That is why we choose Riga as base. For the US, the initial demand was from the regional Frisian government to join the 400 year relationship between New York and Friesland. The Fryslan House model provided the perfect business match for it.
Expert opinion
This is a good practice from the Netherlands, where a peripheral region Friesland has come up with a clever solution to support the internationalization ambitious of local SMEs. Namely, foreign offices have been set up in New York and Riga that the beneficiary SMEs can use as a communication and meeting address. The SMEs get a chance to develop international business abroad and in return, pay a yearly contribution. This is quite a new scheme with 25 SME members, but the evidence of success already demonstrates good results with more than 4.5 MEUR turnover realized from 200,000 EUR of public funding. The main challenge is to find solid host organizations in the target countries to set up foreign offices, but other than that, the solution has high replication value.
Works at
Interreg Europe Policy Learning Platform
Resources needed
Funding was provided by the regional development fund from the Province Of Friesland. None labeled funding for improvement of SMEs. Approved by the Provincial Governor. Total amount needed for 3 years: 100.000 Euro gov. funding. 50 % co-financing.
Evidence of success
Out of 25 SME members, 15 have reached new business results with the formula. 8 in Riga, 7 in New York so far. The total export added value for the SMEs have been 500.000 euro extra exports in the Balitc States via Riga and 4 Meuro for the US.
From a 200.000 euro investment of public money, 4.5 Meuro extra turnover has been realised.
From a 200.000 euro investment of public money, 4.5 Meuro extra turnover has been realised.
Potential for learning or transfer
This proves that a peripheral region like Friesland can provide an international scaling platform by taking risk in opening a foreign office. Based upon 5 participants, the yearly costs of about 10-15.000 euro can be returned and the model can be operated. In New York we now use a model where we pay per client 80% of our income to the agent in NY. This means we always make some gross profit to cover for administration costs and other fees. The start of the programme per city was sponsored by the regional government.
Further information
Website
Good practice owner
You can contact the good practice owner below for more detailed information.
Organisation
Business Development Friesland
Netherlands
Friesland (NL)
Contact
Managing Director