Drive in the Dutch market
Flexibility has been an important factor behind the success of Linesight and other Enterprise Ireland supported companies in the Netherlands.
With its English language proficiency and openness to doing business with other countries, the Netherlands is an ideal target market for Irish companies looking to spread their reach outside Ireland and the UK – something which Dublin-based professional services firm Linesight recognised five years ago to its advantage.
“When the recession hit in 2008 we began to look at international markets more keenly,” says Linesight director Paul Butler.
“The Netherlands appeared particularly promising as pharmaceutical multinationals were starting to set up subsidiary plants there and Amsterdam had become a hub of activity for data centres. We had built up significant in-house expertise in both of these areas in Ireland.”
Established in 1974 as Bruce Shaw and rebranded last year, Linesight provides professional services and strategic support to the global construction industry. Projects span a range of industry sectors including commercial, data centres, lifesciences, healthcare, transportation and infrastructure and retail.
Linesight increased its global headcount by 135 and recorded turnover of about €60m for the group in 2016. With staff located across Europe, the Middle East, Asia Pacific, and North America, it now has 17 offices around the world and has delivered projects in 40 countries.
Before embarking on its expansion strategy into the Netherlands, Linesight did a lot of up-front fact-finding and market research with the support of Enterprise Ireland. It also put significant effort into finding the right contractors to deliver on projects as well as getting to grips with local regulations and planning codes.
“We realised that we needed to stretch our web of contractors beyond the Amsterdam area, as regions differ in relation to construction – there is more heavy industry near the German border for example,” says Butler.
Gaining an initial foothold in the Dutch market involved Linesight securing contracts with existing clients planning projects there. In some cases the company was the preferred bidder for projects and members of its staff went into the market as part of clients’ teams.
“The personal relationships we had developed through our partnership approach with clients were very important,” says Butler. “Our people have been key to our success when looking for repeat business.”
Having full-time employees on the ground has also played a significant role in Linesight’s growth in the Netherlands. It has gone from having a team of four people five years ago to employing 30 at its office in The Hague. Its fee base has grown by about 70% in the market over the same timeframe.
David Corcoran, market adviser at Enterprise Ireland’s Amsterdam office, says that while Linesight followed the typical path for many companies in construction services – ie, working with existing clients – it has also been very good at business development and capturing new customers.
“The fact that Linesight looked to increase its local knowledge and chose to set up an office in the country has been extremely important in this regard,” he says.
Linesight is one of a number of Irish companies serving the construction industry which have established a presence in the Netherlands over the past 20 years. Others include DPS Engineering, CRH and Kingspan.
“The success of these companies since 2011 has been driven by the large amount of investment by the pharmaceutical sector in Greenfield sites and the refurbishment of existing plants,” says Corcoran. “But they have also been expanding rapidly in the secondary markets of food processing and data centres.”
The Netherlands has shown double-digit growth for Enterprise Ireland supported companies generally for the past few years, reaching total sales of €954m in 2015, according to Patrick Torrekens, market adviser for the Benelux region at the agency. There are now 150 Enterprise Ireland clients active in the market, 30 of whom have a visible presence there.
Opportunity exists in numerous sectors in the Netherlands for Irish companies with the flexibility to adapt, notes Torrekens. He cites logistics and transport, for example, thanks to the logistics cluster that exists around the ports of Rotterdam and Antwerp and Schiphol Airport.
“This cluster has not only been positive for Irish companies engaged in infrastructural projects, but also for those active in e-commerce and the Internet of Things. Digital in general is a priority for the Dutch government, which has launched incentives to support the sector,” he notes.
“The Netherlands is one of the best connected and most sophisticated countries in the world. It has a similar environment to Ireland in that it has attracted leading global digital companies such as Huawei, Google and Microsoft.”
Torrekens also sees a good match between Irish capability and the opportunity that exists in agricultural solutions, lifesciences and IT security.
“We believe there is potential for double-digit growth over the next number of years in the Netherlands and it is a market that can play a key role in the market diversification strategies of companies.”
Market entry tips – the Netherlands
Patrick Torrekens, market adviser, Benelux at Enterprise Ireland, shares his key pieces of advice to companies looking at the Dutch market:
* A company can generate sales in the Netherlands from an Irish base in its first phase of growth. However, as business picks up and it sees traction, it is important to establish a local presence. This will ensure it is closer to the end market and will speed up further sales.
* The Netherlands can be a good stepping-stone into other eurozone markets. The whole infrastructure and logistics system there is organised to give easy access to Germany and Belgium. Linesight is one of a number of Irish companies which have expanded into these markets from the Netherlands.
* Coping with the business culture can be a challenge for Irish companies as Dutch businesspeople tend to be quite direct. This has its advantages, however, as it means you can find out quickly whether or not they are interested in your product or service.
* The value proposition of your product or service needs to be very clearly defined. You must have a very sharp pitch when meeting potential clients.
* It is important to really understand your end market, even if you are not selling directly to clients. A common mistake companies make in the Netherlands is to leave everything to the distributor; you have to think of the end users of your product or service.
To read more about Linesight’s exporting strategy as well as tips and insights from Linesight director, Paul Butler, click here.