Differences Between Doing Business in Europe and Doing Business in the USA

Europe and the USA have a similar land mass and as most European business professionals can speak English; you could reasonably argue that they share a common language as well. However, this may be where these fairly superficial similarities end as when we get down to doing business, we don’t seem to understand each other, even though we often share the same problem, just from different perspectives. Let me explain:

Differences between Europe and USA: distorted realities

America has always billed itself as the land of opportunity and there are no end of movies and songs to maintain that narrative and that along with the size of the US’s economy are two of the reasons that European companies find America such an attractive proposition. Arriving in the States expecting it to be the land of free-wheeling capitalism though would be a mistake as the bureaucracy and red tape can tie you up in knots just as much as may happen in any European country.

Equally, the Americans approach Europe as they see it as a way to establish their product outside of the US and grow their reach. What they tend to forget though is that when you are a third country trying to do business inside the EU, the level of administration and paperwork that needs to be completed is as bad as anything the Americans can throw at the Europeans.

Misconception of doing business in the USA: it’s all one country

When the Europeans think of America, they tend to consider it as one country. Technically, they are correct but they are missing one very important distinction. Just like Europe is made up of individual, sovereign countries, the United States of America is made up of independent states. The clue is very much in the title. And again, while they are in a union, each state has autonomy over its own laws and taxes meaning you may have to consider if one state is more open to or appropriate for your business than another. 

The Americans too tend to think of Europe as a single entity. The impression seems to be that the Europeans all live close to one another, they have a relatively shared history and as a consequence they must all be the same. As we know, this is simply not true and a guaranteed way to start an argument is to tell one native of a European country that they are exactly the same as their neighbours.

In this context, considering the differences in state laws and taxes, companies can effectively leverage sales outsourcing to navigate these regional variations. By partnering with a sales outsourcing agency that specializes in both the U.S. and European markets, businesses can tailor their strategies to each region’s unique market, enhancing their presence and efficiency across borders. This approach allows for a more adaptable and locally informed business model.

Market entry and etiquette

If you intend to do this on your own, research, research, research is the only way forward. This applies equally to whether you’re a European country trying to enter the US market or vice versa.     

Individual states must be treated with the same cautions as individual countries. And, if you don’t speak the same language as your host bring someone with you who does. It would also be considered good form if you could learn a phrase or two in your host’s language. Culturally, you must respect the norms of the country or state you are in as offending people is not good for business. You’ll find that some territories are more culturally sensitive, strict or relaxed and it would be best to know which is which before deciding on your approach or pitch.    

There will also be business nuances in each territory that are just he way things are done there. Quite often this is considered to only be local knowledge but you may be able to use a chamber of commerce or investor’s centre to find out what you should and definitely should not do. 

Doing business: the good stuff

The United States and most European countries are either top or very close to the top of international charts for competitiveness and ease of doing business. This is largely because both Europe and the US have a defined regulatory environment which can ease some of the concerns of starting a business in a new territory. Although, in fairness, the business culture of both territories encourages free enterprise and competition. Further advantages include stable democracies, traditionally strong economies and a transparent legal system. 

An inescapable conclusion

It’s obvious to see that there are opportunities for both American companies in Europe and European companies in the US. There are pitfalls though and basically everything above is where companies could fall down. With such clear evidence, it would be foolhardy to attempt a market entry on your own in either direction. With Aexus though, we have people on the ground in each territory. Not only are they local to the area and speak the language, but they are also familiar with all the cultural and business nuances that could make or break a deal. What’s more, because they work in the market every day, our tech savvy SDRs come armed with a list of contacts from the type of companies that you want to speak to.

To see how we could help you to enter either the European market or the US market, get in touch. We’re always happy to jump on a call.

Topics: Strategy