Market Information

Business Practices in The Netherlands

Business Practices in the Netherlands

IT Experience

The Dutch population has a lot of experience with IT. For example: 83% of the population uses internet banking (source: www.tweakers.net), more than the UK (77%), France (63%) and Germany (62%). This is decisive for knowing how to do business in the Netherlands.

93% of the population has a smartphone, which is the highest percentage in the world (source: Deloitte). These smartphones are used for internet banking, shopping and for access and boarding passes. The number one app is Spotify.

Internet access is almost universal: 98% of households have broadband Internet access (source: CBS).

For more information on the Netherlands Market, we suggest you also read:

Most companies make

People are not easily impressed

Testing Ground for Europe

Business Practices in The Netherlands

People are not easily impressed by an application. Appearance and ease of use are almost as important as functionality.

That is why many companies use the Netherlands as a testing ground for their products and services before they start operating in the rest of Europe.

When it comes to IT usage in business, you’ll find that most companies make extensive use of IT. This is why many IT companies are active on the market.

These companies employ 365,000 people, representing 54% of total demand and around 4.5% of GDP. 95% of these companies have 10 employees or less and only 200 employees have more than 100 employees.

Source: Atradius

The IT market in the Netherlands is very competitive. This means that there is price pressure.

Most companies have already outsourced IT projects or entire IT departments to providers. They have experienced both the advantages and the disadvantages. The most common negative point is the communication: “the supplier has not built what I need”. “They didn’t understand me.”

Business Practices in The Netherlands

Culture

Just Google: “poldermodel”

Culture is also a decisive factor if you want to know how you do business in the Netherlands. Dutch culture is open and there is no division between classes. This means that people can (and will) disagree with each other. Regardless of whether it’s their manager, their client or their friend. This is not perceived as disrespectful or rude. This is the driver of the “poldermodel” (consensus decision-making).

The Dutch will not use polite sentences to explain their thoughts. They are very direct and expect you to say “No” if you don’t agree. A polite “yes” can cause future problems. For example, if you are asked, “Will it be ready next week?” Or “Can you do that?”

A supplier has to advise his clients well. Honesty and clarity from the start form the basis of a good relationship. If they are not met, projects are doomed to fail from the outset.

Client relationships often start small with a “Prove of Concept” (PoC) or “Prove of Value” (PoV) to show the possibilities of your company. This creates trust and lays the foundation for a long-term relationship with your client.

A low price isn't everything

Pricing

A low price attracts the attention of a potential customer.

For more information please read the price information per segment on the pages about Mobile & Web Services, Software Development and e-commerce.

Most companies already have experience with foreign IT service providers, so they also know the drawbacks:

  • Miscommunication, which prevents the customer from getting what he ordered
  • Promises that are not fulfilled
  • Deadlines that are not met
  • Low quality in terms of maintainability and documentation


Customers take this into account when assessing the price!

What does this information mean to you?

  • The Netherlands has a very high level of digitization. It will be difficult to surprise customers with propositions
  • The Dutch market for IT services is highly competitive
  • Don’t assume that your customer’s CEO will make the purchase decision
  • People will be very direct in questions and comments, they expect you to be just as direct
  • As a professional service provider, you have a responsibility to advise your customers to the best of your ability
  • Do not expect blue birds or low hanging fruit. Developing a business relationship takes time and starts with a small assignment before it becomes a big deal

What can you do to increase your chances?

  • Prepare for meetings with IT professionals
  • Create a message about how your business ensures quality despite a low price
  • Treat everyone you meet as a potential customer
  • Dare to say, “This is not possible”
  • Don’t insist on a deal. Have a “I’d like to do business with you, but I’m not desperate” attitude in conversations

Business Practices

Talking Business

In the Netherlands, all meetings are fuelled by coffee. A meeting starts with coffee and a conversation about weather, sports and traffic. This normally takes 5-10 minutes.

Let the customer first talk about his/her company and challenges. This gives you a better understanding of their needs, so you can talk about your proposition on that basis. It’s not about selling at this stage, it’s about getting the customer to talk about their needs and then tell them how you can help them.

In large companies, you hardly ever meet the decision-maker in the early stages. You will have to deal with managers and specialists. In smaller companies you often meet the decision-maker.

Keep in mind that decision makers are only interested in the business case (cost savings, more turnover, higher customer satisfaction, time to market, etc.). The specialist will talk about ITIL, Agile, standards, and so on.

Don’t insist on a deal. If you do so, the chance of a second meeting is reduced and the client will start to worry about the stability of your company.

In the Netherlands, decisions are taken on the basis of consensus (poldermodel). This means that your customer will be looking for a second opinion within his trusted circle. This could be a manager, a colleague or a friend. If he is still interested, he will agree to a second meeting.

Don’t expect to get a deal soon. Don’t expect a big deal as your first deal. Offer small projects that generate quick profits. You need to build trust and confidence through different contacts and small projects or Proof of Concept.

What does this information mean to you?

  • Selling in the Netherlands means first of all listening to your customer to gain insight into his/her needs
  • Treat everyone you meet as a potential buyer, regardless of their function or appearance
  • Entrepreneurs and business managers talk about money, IT people talk about IT
  • Doing business in the Netherlands takes time

What can you do to increase your chances?

  • Try not to sell, but make it easy for customers to buy
  • Treat everyone you meet as a potential customer
  • Entrepreneurs and business managers talk about money, IT people talk about IT; adapt your value proposition to your audience!
  • Don’t insist on a deal. Have a “I’d like to do business with you, but I’m not desperate” attitude in conversations
  • Dare to say “No”

Additional information