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GOING GLOBAL EXPORTING TO A guide for clients

#GlobalAmbition Capital

Population 10.1m1

GDP Per Capita: $52,7662

Unemployment 6.7%3 UMEA

SUNDSVALL Swedish exports increased by 23.5% in 20184

Predicted economic growth for 2019 5 1.9% OREBRO STOCKHOLM Ireland client exports (2018) LINKOPING ¤338m6

JONKOPING

GOTHENBURG

KALMAR

MALMO

2 WHY EXPORT TO SWEDEN?

Sensitive to change and quick offers a variety of opportunities to Irish businesses. and infrastructure, to adapt, Sweden is a global and life sciences are all sectors that have received knowledge and hub. investment in the last few years. With a strong economy and a Bordering and , and connected to highly educated labour force, this by the Öresund Bridge, Sweden allows good access to the Nordic . Flight connections is a country where high standards from Ireland to Sweden are good, with direct flights go hand in hand with tomorrow’s to and from to Stockholm with SAS and brightest ideas. Norwegian. Sweden is a politically stable country whose combination of a largely free-market economy and far-reaching welfare investments has facilitated some of the highest living standards in the . OTHER ENTERPRISE IRELAND As the EU’s largest producer of renewable energy, CLIENT COMPANIES ARE SELLING 7 timber and ore , exports of goods and services INTO SWEDEN, SO WHY AREN’T comprise more than 45% of Sweden’s GDP8. The Swedish economy has performed strongly over YOU? the last few years, and even though GDP growth • Sweden is the 10th best place to do business in is expected to slow down somewhat in 2019, the the world15 economy is still predicted to continue to grow. Sweden is the 15th largest export market globally • Sweden is the most sustainably competitive for Enterprise Ireland clients. Sweden has been a country in the world16 member of the EU since 1995 and its is the • Sweden is the most macroeconomically stable krona9. country in the world17 Many Irish companies have performed well in • Sweden is the 3rd least corrupt country in Sweden and speak positively of the ’ the world18 cooperative, straightforward and transparent nature. Sweden consistently ranks as one of the most • Sweden is the 7th most stable country in the innovative countries in the world10, and Stockholm, world19 the country’s , is second only to Silicon • Sweden is the 6th most environmentally Valley in terms of billion-dollar start- companies sustainable destination globally, and ranks 4th 11 per capita (also known as ‘Unicorns’) . Swedish for ICT readiness and 8th in human resources/ consumers are sensitive to new trends and with a labour market20 market that has enjoyed annual growth for th more than 20 consecutive years12, the country can • Sweden ranks 7 in the OECD for quality 21 offer a good market for new products. of education

Sweden offers a business environment that is • Sweden is second in the OECD in terms of 22 welcoming to international business partners – researchers per 1,000 employed Swedes speak excellent English13, the country is • Sweden spends more on R&D than any other a geographical hub in the Nordic region, and it is European country23, 3.2% of GDP widely considered one of the best places in the • Sweden has the 2nd most advanced digital world to do business14. Whilst remaining a country economy in the EU24 with a commodities-based business sector, Sweden has also emerged as a leading knowledge economy. As a combination of these two things, the country

3 SECTORAL SUCCESS

The world’s 3rd largest exporter of pulp, paper and sawn timber, Swedish forest industry groups are among the biggest in the world25

Sweden is ’s top nation26

With one of the world’s most innovative automotive industries, Sweden leads the way in green vehicle development27 28

From computer games to Fintech, Sweden is home to some of the world’s most innovative tech companies29

Sweden is investing in large- scale infrastructural and construction projects such as new railways, roads, homes and offices30

Major government investments have laid the foundation for a state-of- the-art life sciences research infrastructure31

Sweden is the largest producer in the EU32

The Swedish retail market has reported growth for 21 consecutive years33

4 GET READY TO DO BUSINESS IN SWEDEN

Swedish companies are typically Business culture non-hierarchical and characterised For many Swedes, planning is an integral part of professional as well as social life. If you are planning by informality. This does not mean a meeting in Sweden, then make sure to initiate that Swedes spend any less time arrangements a few weeks in advance. Punctuality, preparing, planning or researching too, is a necessity. Swedes will make sure to arrive at a meeting at least five minutes in advance of their business deals – far from it. the agreed time, so do not be late. Failing to make Indeed, Irish companies need to proper plans or neglecting to follow a schedule may be aware that decision-making give Swedes the impression that you are unprepared or disrespectful of their time. processes can take longer than they A casual dress code is common in many Swedish are used to, as Swedish managers workplaces. For a business meeting, however, it is will often manage by consensus. advisable to adapt to the business attire of your customer or client. Swedes tend to dress well whilst However, once a relationship with maintaining a low profile – a CEO will rarely dress a Swedish company has formed, it very differently to a junior employee. It is important tends to be very strong. to remember that the weather can change drastically from one season to another, so make sure to consult Travelling and geography weather forecasts before travelling. In the , many Swedes travel to work in robust winter boots, As the fifth largest country in Europe, Sweden is full and then change shoes in . Similarly, of contrasts. In the , the of Swedes are likely to dress up for evening events stretches far into the Circle. In the south, the outside of the office. city of Malmö is only a 40-minute train ride from the Danish capital city, . Many Swedish Sweden ranks highly in transparency36 and corporate companies have their headquarters in the capital city social responsibility37, and companies often take a of Stockholm, or in or Malmö, and the strong interest in issues of gender, the environment, university of Uppsala is home to high-quality human rights and corruption. research centres34. Language The largest international airport in the country is A clear majority of Swedes are comfortable Arlanda Airport, which is located approximately conducting meetings in English and talking to you 40km from Stockholm and 30km from Uppsala. A in English on the phone, and public service smaller number of international flights serve information is almost always available in English. Airport, which is located less than 10km from central Irish companies who intend to enter the market will, Stockholm. at an initial stage, be able to do business without It is best to avoid travelling to Sweden for business knowledge of the . However, during the holiday seasons or in the month of those who plan to stay in the market for a longer , as that is when many Swedes go on extended period ought to consider professionally translating . A list of bank holidays can be found on marketing material, presentations and business the website of Sweden’s central bank35. cards into Swedish.

Sweden is one hour ahead of Ireland.

5 Routes to market

Distributors/Agents:

Distributors and agents can be a good way to access the market. Swedish distributors tend to have a direct, no-nonsense approach to business dealings, and often have little time for small talk. It is important to prepare well for meetings and to be able to offer detailed information and a strong unique selling point.

Direct Sales:

Direct sales are possible but knowledge and understanding of the Scandinavian way of doing business is an advantage – e.g. long sales cycles, consensus-driven approach, flat management structure, punctuality, etc.

Pathfinders/Market Experts/Consultants:

Pathfinders can play an important role given the scale of the market and the depth of knowledge and contacts required to penetrate niche areas of interest.

Partnerships:

A variety of partnership options are possible, including joint ventures, licensing, and R&D collaboration.

6 THINGS TO CONSIDER

Every Nordic country has its own culture and tech has enabled the country to become one of the traditions, meaning that while they are very closely first (almost entirely) cashless societies in the world linked, there are some things that will work in one with less than 1% of all payments made using cash in country and not another. As separate countries 201640. they also go through different challenges and opportunities at different times. For example, the Target Market tech sector may be booming in one country while Price and quality significantly influence Swedish it declines in another. This needs to be taken into consumers purchasing decisions. However, research account when proposing your product to each prior to making a purchase or signing a contract is a market. The following considerations can help highly important process for the Swedish consumer, guide you in your exporting decisions. with their focus being the durability of the product or – in business arrangements – the reliability of The Market the partner41. On average, Swedish consumers have Many Irish companies have found Sweden to be a high purchasing power, 10% higher than the EU a competitive market. Due to the maturity of the average42. This means that Swedes are used to market, unique product offerings are vital to success. higher standards and have high expectations of Swedish businesses are very careful when entering the products and services they receive. The love of into new contracts with new companies, especially technology in Sweden is also evident in consumer those without proven success in the market. purchasing patterns, with 67% of the total population However, once you have connected with a Swedish having shopped online in 2017, 35% of which stated business, they are known for being reliable and loyal that they shop on their mobiles43. business partners. Market Segmentation Irish companies that are best positioned to win in Having a clear understanding of the market Sweden tend to have the following attributes: dynamics of the specific industry sector being targeted is necessary. Who are your most probable • A world class technology, product or service customers, where are they located, how and what innovation with a clear value proposition else do they currently buy, who are their influencers and what “need” are you fulfilling that your • A commitment to sustainability and efficiency competitors are not?

• Well prepared and planned for meetings (with Market Competition meeting agendas easily expected one month in advance) Sweden is a mature market with well-entrenched domestic and international competitors, particularly • The ability to deal with demanding technical and in technology and telecommunications. New entrants customer servicing requirements/queries need to identify what their product/service offers that is innovative and technology-leading, otherwise Market Trends it can be difficult to become established. Sweden has one of the most ambitious Market Research Resources policy acts in the world, and companies prioritise initiatives that are proven to be efficient, sustainable Enterprise Ireland’s Market Research Centre offers and carbon neutral38. Furthermore, the Swedish client companies access to market intelligence in government has launched a plan for ‘green growth’ the form of company, sector, market, and country that aims to reduce the country’s economic reliance information to explore opportunities and compete in on ‘heavy industries’ such as mining39. As early international markets. Information can also be found adopters of many technologies, Sweden’s love of on Business Sweden, and Invest Stockholm.

7 See Enterprise Ireland’s Market Research Centre online for more information on the market research facilities available, and for a database of sector- specific information that will indicate whether there is research available for the market you wish to target.

Business Sweden is the trade and export development agency for Swedish companies but often provides guides to start-ups and for individual sectors, such as retail44.

Business Sweden also promotes ‘Invest in Sweden’ which is the direct foreign investment side which presents current market information as well as potential business opportunities.45

Invest in Stockholm provides information on the Stockholm region specifically, such as: things to consider if moving and working in Stockholm; and information on investment opportunities46.

For more information on business culture in Sweden, Sweden.se has a guide to the atmosphere and expectations of Swedish companies as well as some dos and don’ts47.

Boots on the Ground Depending on the type of business, aiming for in- market representation in the longer term can be important, but is not necessarily required. However, it is necessary to build good relationships with Swedish partners. Most successful Irish companies in Sweden have a distributor/agent/sales manager on the ground or at least visit the market several times a year.

If setting up a presence in Sweden, there are plenty of co-working spaces readily available and with different sector focuses.

8 KEY GROWTH OPPORTUNITIES IN SWEDEN

Cleantech Examples of projects in Sweden61 Sweden has been at the forefront of environmental protection for years and is considered to have one of the most ambitious climate action plans in the world48. The government has focused incentives to reducing pollution as well as supporting green technologies in the hope of combining economic growth with a decreased carbon footprint49. As part of their hunt for innovation and better technologies, Sweden has among the highest R&D spending in the ERTMS - 50 throughout world . West Link Sweden As Cleantech 2.0 becomes a priority globally, Sweden is again at the forefront of the movement, Marieholm joined by , UK, the and Connection USA51. The Cleantech industry in Sweden has an Stockholm Bypass annual turnover of approximately ¤22bn52. Gothenburg Harbour Line Eastern Link One of the main focuses in Sweden is the building of smart grids. One of Sweden’s significant targets is for the Stockholm Royal Seaport to be the first city in the world to have installed full-scale smart grids53. Additionally, major investment opportunities in Cleantech includes green building; waste and recycling ; and renewable energy sourcing54.

Construction and Data Centres 4 track Flackarp-Arlöv Sweden’s construction and infrastructure sector is thriving, with Sweden planning to spend ¤64bn on major transport network projects as well as building Life sciences 55 700,000 new homes and offices . Business Sweden Sweden’s technology-driven environment includes even states that “for international suppliers operating close collaboration between academics, healthcare in the rail, roads and construction sectors, this is and industry to create Medtech innovations which a unique opportunity to expand into a dynamic have saved and improved patients’ lives62. In 56 market” . The focus for these projects is high speed particular Sweden is known for its radiotherapy rail, metro expansion and a new route for the E4 and imaging technologies63. The Medtech industry 57 motorway that passes Stockholm . in Sweden is most prominent in regions such as High-tech construction is also vital to Sweden’s Stockholm, Uppsala, Umea and Skåne. Additionally, future plans. , Microsoft, Amazon Web it is important to note that there are many aligned Services (AWS) and Facebook have all chosen interests and collaborations between Sweden and Sweden to host data centres as well as critical Denmark (such as the ), particularly in systems58. This is because Sweden boasts secure and the Skåne region (which borders Denmark). sustainable power, fast fibre networks, one of the The main opportunities in Sweden lie in drug lowest costs of energy in the world, and a high level development, biotech, diagnostics and Medtech, 59 of ease doing business . including digital health. Digitalisation needs are It is important to note that there is a procurement driving innovation in the Medtech industry with process involved in achieving these construction specialised solutions required for increasing space projects. Having a Swedish partner is not required available in hospitals, decision-making support- to participate in these projects, but it can give you a systems and further developing patient registries64. unique edge60. Enterprise Ireland can also give vital There is also a drive to encourage Swedish citizens support and assistance in getting through these to take an active role in preventative measures and stages. treatments65.

9 ICT retail locations76. It is, however, well-developed and dominated by a small number of large chains such Sweden has one of the highest profile tech and as H&M and IKEA which have become global leaders start-up scenes, second only to Silicon Valley66. in their fields due to their innovative outlook77. If Most innovative tech companies see Sweden as one considering entering the retail market in Sweden, it of the few places in the world where they must be is important to note that consumers will expect an present to stay ahead67. Sweden is home to many effort towards sustainable development78. internationally recognized innovative companies, such as & (the creators of ‘candy crush’). Retail sales per segment79 In particular, Fintech has been a key growth opportunity with consumers and banks willing to work with online payment providers such as iZettle and Trustly68. Fintech start-ups have managed to become a part of everyday life69. Major trends for banks in the Nordics include: • Customer centricity: Customer analytics and technology which allows greater customer 820 SEK BILLION knowledge and big data interpretation and a (¤80 BILLION) greater customer experience. • Mobile innovation: Mobile is now the preferred choice of platform for banking and ensuring optimal payment options, card integration and usability is vital to the banking sector. • Support mechanisms for Cultural Transformation: In-class training for all levels of the organisation 45% Daily goods 9% E-commerce and managing cultural issues of transferring to 13% 8% Clothing equipment & DIY . 6% Automotive fuel 10% Sport, leisure & electronics 9% Other Research and developments in the Internet of Things (IoT) is steadily increasing. From autonomous cars Source: , 2018 to smart systems, Sweden is a world leader in the IoT revolution and making use of its benefits70. For foreign companies, opportunities exist for Presence of International Retailers80 collaboration for production and R&D.

Retail STOCKHOLM Sweden’s retail market has experienced over 20 years of year-on-year growth, with consumers spending 40% of their income on retail purchases71. COPENHAGEN As one of the top performing economies in Europe, Swedish consumers are ‘trendsetting’ early adopters with a keen interest in international retail brands72. Sweden is home to international market leaders in Mainstream Premium Luxury several industries, including IKEA and H&M. Sweden is also the largest retail market in the Nordics, and a well-established test market73. Together, Sweden, Stockholm is the springboard for retailers into the Denmark, Finland and Norway make up the 11th region and has the highest presence of international largest economy in the world, consisting of 26 retailers compared to its Nordic peers, followed by million inhabitants74. The Swedish market presents Copenhagen, Oslo, Malmö, Gothenburg and finally a unique opportunity as it has remained relatively Helsinki. untapped by international retailers75. The retail market is largely open to international brands, with Source: JLL, 2018 Stockholm, Gothenburg and Malmö being prime

10 LEGAL AND TAXATION INFORMATION

Visa requirements Employment Sweden is a member of the EU and of the Schengen The focus of Swedish employment law is to Area. Irish citizens do not need a visa to enter ensure that workplaces operate under fair and Sweden and can remain in the country as a visitor proper conditions. The Swedish Employment 81 for up to three months . The Department for Foreign Protection Act91 – Lagen om anställningsskydd Affairs and Trade offer comprehensive travel advice (LAS) – is the guarantor of that intention. LAS for Irish citizens travelling to Sweden: contains comprehensive requirements concerning https://www.dfa.ie/travel/travel-advice/a-z-list-of- , terms of employment, types of fixed countries/sweden/ term contracts, holiday allowances, temporary replacements, entitlements, and much more. Import rules and regulations For example, Swedish employment contracts apply Sweden is a member of the EU Customs Union and indefinitely unless otherwise specified, and parents the Single Market. are allowed 480 days of paid parental leave92. Irish companies are advised to get acquainted with rights employment law before hiring people. The Swedish Patent and Registration Office (PRV) grants patents for Sweden but can also be used in the process of obtaining patents internationally82. Comprehensive information about applying for a patent in Sweden can be found via The Swedish Patent and Registration Office: https://www.prv.se/en/83.

Corporate structures Foreign companies wishing to operate in Sweden are most likely open a branch office or establish a Swedish subsidiary, both of which must registered at the Swedish Companies Registration Office and the Swedish Tax Agency84.

More information about setting up a business in Sweden can be found via the Swedish Tax Agency85 and the Swedish Companies Registration Office86.

Key taxes and licenses The rate in Sweden is 22% and companies are required to pay tax on profits made from business activities, investments, selling assets and royalties87. The Swedish Tax Agency88 offers comprehensive information about how to register a business for tax purposes. Step-by-step guides can also be found via the Swedish Companies Registration Office’s website89.

Some types of businesses require a licence before they can start operating. A list of businesses and trades that require licenses can be found on the Swedish Companies and Registration Office90.

11 HELPING YOU WIN IN SWEDEN

Pre-visit support events programme Prior to engaging with an overseas market, client Every year, Enterprise Ireland organises an extensive companies should engage with their Development programme of events to support your business Adviser (DA) and the Enterprise Ireland Market abroad. These include: Research Centre in Dublin to ensure they leverage • Inward buyers’ missions to Ireland the full range of possible supports in preparation for engaging with the Enterprise Ireland team in the • Group stands at important international trade fairs market. • Overseas trade missions • General market and country level information • Study visits to gain knowledge of overseas markets • Sector overview • Client knowledge events including seminars and • Validation of the opportunity for your product or workshops service • Networking events to build and enhance • Evaluation of your market entry strategy relationships with market contacts

• Suggested channels to market • Further information is available at: www.enterprise-ireland.com/events • Competitor analysis

• Relevant contacts/suggested itinerary Power up your progress by plugging into an Irish network • Summary of relevant market information resources Embassy of Ireland, Sweden: In-market support www.dfa.ie/irish-embassy/sweden/ • Introductions to buyers and decision-makers Irish in Sweden: • Identification of potential partners https://www.irishchamber.se/

• Facilitation of buyer visits to Ireland

• Assistance with product launches/workshops

• Securing reference sites

Mentors Enterprise Ireland has built up an excellent network of mentors in Sweden who are able to work with Irish client companies on developing their businesses. This includes market and sector specialists, business accelerators and members of Irish business associations.

12 References

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13 References

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92. https://sweden.se/quickfact/parental-leave/

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