An economic overview
Taking the initiative to invest in a foreign country has never been easy, and nowadays the Covid-19 situation has made everything a bit more complicated for everyone worldwide. But, resilience is the word that defines the world today, and thanks to that, the opportunities are once again blooming, particularly for Americans who want to expand to european soil.
In this particular case, Spain offers a wide variety of opportunities and presents itself as a very attractive prospect for investment.
But before getting to the markets that are currently blooming in Spain and could welcome you with open arms, let’s talk about Spain’s strengths, attractives and current position regarding Covid-19.
Spain as a resilient force
Over the years Spain has gone through and overcome many crises of different types. In the current scenario this plays a very important role. You might be wondering “How so?”, and the fact is that Spain is no stranger to crises, and even though many people might think this is not a good thing, the truth of it all is that after every crisis the country has become stronger and more stable and capable.
Thanks to the effect the last crisis had over the country, including politics, finances, real estate and public services, Spain’s economy is more and better diversified and incredibly cost competitive.
Spain has also secured a position among the world’s top exporters, and is expected that its economy will continue to grow, at least 6.38 to 4.7% between 2021 and 2022.
Currently Spain is already feeding its tourism engine and promoting foreign investment full force, due to its effective plan of action against the pandemic, they are already bidding farewell to their facemasks.
Spain and the United States
The relationship between Spain and the United States is not new. Both countries have had a long economic relationship. Whether bilaterally or within the european region, Spain remains an important partner for the United States.
When it comes to the relations between Latin America and Europe it is, without a doubt, Spain the one who leads the way, this is also a very appealing point for those Americans who target Latin American market as well.
Spain has been a significant export market for the U.S for a very long time. A considerable number of the largest companies of the U.S are present in the spanish market, particularly in industrial sectors such as automobiles, chemicals, pharmaceuticals, etc. This is also advantageous, given that the presence of american companies, american products and english speakers is not out of place for spaniards; therefore, the market will receive you with open arms.
Even though you might think all bases are covered in the spanish market, there is always room for improvement and more, especially in business.
Over time and through different situations, customers change, their needs change, their views change and it is up to the companies to get the best out of those changes. If you’re an existing company you must adapt, and if you’re a start up you have a whole white canvas to paint and grow.
The United States is a constant presence in the spanish markets; and even though this whole Covid-19 situation has made things harder, it has not stopped exports. When comparing U.S exports to Spain during 2019 and 2020, it is noticeable there was a reduction during the latter, but it never stopped and thanks to the hard effort of Spaniards regarding the pandemic they’re recovering their daily pace once again.
Chemicals, oils, pharmaceutical products and aircraft have been the main export products from the U.S to Spain during the last few years. This information can come in handy for you and your company or startup.
The spanish market has also been influenced by this whole healthy wave that is taking over the world, and in this regard, food processing, beverage processing and agricultural processing sectors are gaining more importance and relevance.
This boom in food consciousness and interest in food processing could be a great opportunity for food ingredients exporters, and it is a good thing to know that, regarding food, the U.S.-EU Organic Equivalence Agreement has come into effect since June 2012. This means that a product that has met all the requirements to be labeled as “organic” in the United States can also be sold as “organic” in the EU and vice versa.
Just like food and health the technology market has been growing, and we could say that it’s growing at a pace even higher than any other market.
Every company, old or new, established or recently created, has undertaken the digital transformation or digital constitution as an essential part of their existence to be able to stand a chance in this technological era.
Being able to contact a company through the internet, being able to receive customer support or assistance through a platform or a website has become a given for the customers.
Nowadays, if a company has no internet presence (website, social media accounts, etc) it creates a sense of distrust in the client, and taking into consideration that most people have had to transfer at least 80% of their lives to the digital world, the digital ways have become essential.
This digital rush could translate to many things, from an e-commerce company to IT services or AI developers. The possibilities in the field are endless, and given the fact that the United States are widely recognized for their quality products and capable personnel, particularly in the technological area, it is definitely a market to keep in mind.
You must keep in mind that due to its fairly advantageous setup, the spanish market is very competitive. You will not only face local competitors, but also other foreign investors, and thanks to the incredible development of the country through the crises, it will be a tough battle.
Spaniards know what they want and they have a wide market able to offer a variety of products and services to cater to different types of customers.
Knowing all this, there are 3 basic point you must take into consideration when incurring into the spanish market:
Cost: Spain is a price sensitive market. There are local standards as well as EU standards that foreign goods must comply with. In this regard the help of professionals is really necessary for you to get the certifications and permits necessary.
Financing terms: Even though financing is not a new concept for american companies, sometimes they fall short of their competitors in this regard.
After-sales service: This is an essential part of the sales service, and keeping in mind that the relationship with the customer does not end after the purchase will help you cause a good impression.
Let’s not forget that cultural aspects can also be very important, and depending on the region it can also influence the regulations of your products. For example, in the Catalonia region it is necessary that your products are labeled in catalan.
There are different types of foreign investment and there are quite a variety of markets, trends and information to take into consideration. Every aspect of a company creation must be addressed and to this the cultural consideration must be added.
The best course of action will always be to find professional help and support, in this way you can be assured of the process you’re undergoing and its righfullnes.
The U.S Commercial Service in Spain offers a wide variety of services to help american companies export goods and services to Spain.
In TAS Consulting we offer you the best integral service, we are here to help and support you during your course of action. We are your trusted partners in Spain.