Expanding your B2B business to a new country can be daunting. Obviously, you need a solid market entry strategy, but also you need to develop a deep understanding of how B2B sales are done in market you're eyeing.
Vainu expanded to new markets a few years ago, so we thought we'd like to share our story and how we did by answering these ten common questions about expanding a B2B business to the Nordics. We'll take our expansion to Sweden as an example.
1. Do you need a Swede to sell in Sweden? A Dane to sell in Denmark?
It's not about nationality, but actual sales skills. For example, we have both Swedish and Finnish people in our team in Stockholm and they all do a great job with customers. If we look at the top four individual sales performances, it’s 50/50 between Swedes and Finns.
2. When expanding to the Nordics, should meetings be held in English or in the local language? How about translating your material and content?
We've seen a slightly higher hit rate and conversion rate with local language. However, most people are fluent in English as well, so it does work. For a stronger local presence in the Nordics, we recommend you use local language in your material and content as much as possible.
3. Is it easier to do business in Sweden with a company registered there? Did Vainu register a subsidiary in Sweden when entering the market? Does the lack of a Swedish business id and contact information (Swedish office/telephone number) on the website create lack of legitimacy for prospects?
For the first three months, we sold to Sweden remotely from Finland without having a local business entity registered in Sweden. Once we had acquired the first 10 customers, we decided to open up an office and set up a local subsidiary fully owned by our Finnish company. Not having a Swedish organization naturally adds uncertainty with some prospects, so it’s good to have a plan in place to set up a local company as soon as possible.
4. How do the sales metrics (number of phone calls and emails) compare to those in Finland? Is it more difficult to book a meeting by phone in Sweden than in Finland?
In general, getting a hold of people and booking meetings over the phone is relatively easy in all the Nordic markets. In that sense, expanding to the Nordics is easy. Additionally, if you use a data-driven approach and try to make sure you reach out to prospects at the best possible time, you can boost your numbers up a lot. Based on our own data, you need to do 50-100 percent more phone calls/emails per meeting in Sweden, but the numbers are still very low compared to the UK or the US, for example.
5. If you have to call twice the amount of prospects to get a meeting in Sweden compared to Finland, what is the upside of that? Bigger deals? Longer customer relationships? What?
The Swedish market is twice the size of Finnish market. Once you've found your sweet spot, it's easier to scale your business in Sweden, because there are more companies in almost all segments. We have also noticed that a lot of our customers make their Nordic decisions in Sweden, so the probability to close international deals can be higher.
6. Ok, I'm ready to expand my B2B business to the Nordics, what were the practical steps in taking over the market in order?
As an example, this is how we did expand our business to Sweden:
- Analyzed Swedish companies based on our ideal customer profile, which was based on our existing customers in Finland.
- Put all the sales and marketing efforts into these segments, where we knew our service creates lot of value.
- Started booking sales meetings remotely from Finland, conducted a lot of web demos and collected unfiltered feedback from potential customers.
- After signing the first ten customers, three Finnish people moved to Stockholm and opened up the office and started hiring local people.
When looking back at the 15 months after our market entry, it is obvious that we could have scaled our operations even faster when it comes to recruiting local people and building up the B2B sales and customer success teams in Sweden.
7. What has been the biggest challenge so far when looking back at the first year in Sweden as well as when planning the market entry?
In Sweden, there are often more people involved in the decision-making process. It took us some time to figure out the best way to facilitate the sales process when there are multiple stakeholders involved.
8. What were the first hires? Sales people or business development people? When did you hire marketeers? What were the "nine mentioned sources" for recruiting the first 16 employees?
Our first hires in new countries are always sales people, who then form the "founding team". After 50-100 clients, we established customer success team. Our sixth hire was the first full-time marketeer.
We've found our people through LinkedIn, our own networks, job fairs, startup events, referrals and many other career sites where we placed our job ads. In some countries we also use staffing agencies who focus on finding strong sales professionals.
9. What are the steps in order to find the right partners in Sweden?
Map out your short list of potential partners by using a smart company database such as Vainu. After that, our recommendation is to pick up the phone and set up meetings with them. The best way to understand a new market is to meet as many potential customers and partners as possible.
10. What do you think is the biggest cultural difference between Finland and Sweden?
Business culture is very similar in both countries. As mentioned above, the decision making process seems to be slightly different, but smart sales organizations can adapt to it very quickly.
Next: Download our Guide to Sales Prospecting.