Selling to the Netherlands: Explore the Opportunities

Selling to the Netherlands allows you to take advantage of the benefits created by its strategic location, economic stability, and evolving consumer habits. It is, therefore, a market to consider, whether your company is starting the internationalization process or looking to diversify the destination countries for its exports.

The privileged position as a hub for European trade and a distribution center for goods and capital from Asia and the USA is one of the most appealing aspects of this market. Although the trade balance between Portugal and the Netherlands leans towards the Dutch side, this country is in the top 10 of Portugal’s exports, indicating a commercial relationship that can be intensified.

WHAT ARE THE ADVANTAGES OF SELLING TO THE NETHERLANDS?

In addition to its strategic geographical location, which may allow access to other markets, the Netherlands benefits from high purchasing power, with a per capita GDP around $59,307 and a GDP growth, although affected by the war in Ukraine, expected to be around 4.3% in 2022.

Estimates for private consumption growth (6.2%) and the low unemployment rate (3.8%) are also indicators of a robust economy. With approximately 17.5 million inhabitants, it is a country with a high level of economic openness to the outside world.

In addition to low economic risk, the Netherlands ranks extremely well in transparency, competitiveness, and economic freedom.

THE LARGEST EXPORTERS TO THE NETHERLANDS

Imports made by the Netherlands mainly focus on 5 types of products: Machinery and Appliances (24.3% of the total in 2021), Mineral Fuels (15.9%), Chemical Products (12.4%), Agricultural Products (8.2%), and Common Metals (6.6%).

In 2021, nearly half of the imports (48.7%) were concentrated in 5 countries: Germany (17.4% of the total), China (10.2%), Belgium (9.9%), USA (7.6%), and France (3.6%).

Relationship with Portugal

Portugal is not among the largest suppliers to the Netherlands, but in 2021, the Netherlands was the 7th customer for Portugal’s exports of goods, accounting for a 3.9% share of the total. This was also the average annual growth rate of exports to this country in the period 2017-2021. Despite the increase in exports, the balance of trade is unfavorable to Portugal, with a deficit of €1,955 million in 2021.

Mineral Fuels (10.8% of the total in 2021), Agricultural Products (10.6%), Footwear (10%), Pulp and Paper (8%), and Plastics and Rubber (8%) were the main goods shipped to the Netherlands. In the opposite direction, Machinery and Appliances (25.3% of the total in 2021), Chemical Products (20.6%), Agricultural Products (12.8%), Plastics and Rubber (8.1%), and Optical and Precision Instruments (6.3%) were the main imports.

WHAT OPPORTUNITIES ARE THERE FOR PORTUGUESE COMPANIES?

Housing and utilities, transportation, food products, and leisure are interest areas for the Dutch, and there has been growth in consumption in sectors such as furniture, household goods, DIY, leisure, catering, clothing, vehicles, and medical services.

Dutch consumers, on the other hand, show a growing interest in products and services characterized by “easy to use”, concern for health, and sustainability. Online shopping is also gaining more interest, which can be a good opportunity for companies looking to export through e-commerce.

Areas such as environmental technologies, health, information technologies, food products, wines, clothing, footwear, or plastic molds have opportunities in European market.

WHAT TO KNOW TO SELL TO THE NETHERLANDS?

To do business with the Netherlands, must consider a culture characterized by a direct and upfront attitude, informality in treatment, and total respect for private life. Decisions tend to be made based on consensus and can be time-consuming.

The fact that it is a multilingual country is advantageous, as English is widely used. In addition to innovation, entrepreneurship, and high purchasing power, it is a country with a strong environmental awareness, which is an asset for companies that focus on sustainable solutions.

Among the main challenges of this market are its high openness and competitiveness and a high level of distribution concentration. When defining pricing policies, companies must take into account that this country has a significant presence of discount chains, with strong pressure to reduce margins.

HOW TO GET MORE INFORMATION ABOUT THE NETHERLANDS?

The fact that the Netherlands belongs to the European Union facilitates the export process, but it will always be necessary to verify compliance with requirements that concern certain categories of products.

Source: https://www.portugalexporta.pt/