How to Do Business in The Netherlands
January 9, 2018
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The Kingdom of the Netherlands consists of four countries: the Netherlands, located in Western Europe, and three Caribbean islands (Aruba, Curaçao and Sint Maarten).
The Netherlands, also known as Holland, is a modern industrialized country; a founding member of NATO, OECD and the European Union. Their political environment is stable and transparent, resulting in a very favorable investment and business climate. The Netherlands has a liberal approach to many political and economic issues: it was the first country to recognize same-sex marriage and it has a rather tolerant drug policy, allowing the recreational use of soft drugs.
Due to its strategic location and its long history in trading, international trade is one of the most important contributors to the Dutch economy
The Netherlands has a market-based mixed economy with an extensive welfare system providing quality health-care, education, and other social benefits to Dutch citizens. Personal income levels are typically high, along with the standard of living.
Dutch GDP is currently estimated at $872.8 billion, which indicates an economic growth of 2.2%. Services provide 70.2% of the GDP, while industry contributes 17.9% and agriculture 1.6%. Traditionally an agricultural state, the Netherland’s agriculture sector is highly modernized and mainly produces ornamentals, vegetables, dairy, as well as poultry and meat products, and propagation materials.
Introduction to the Netherlands
The main industrial products are electrical machinery and equipment, chemicals, petroleum, metal and engineering products, microelectronics, as well as raw material for construction and agroindustries.
Due to its strategic location and its long history in trading, international trade is one of the most important contributors to the Dutch economy, with the value of trade generally totaling between 60-80% of the GDP. In 2016, total exports amounted to $495.4 billion. The most important exported goods are chemicals, machinery and transport equipment, mineral fuels, food and livestock, and manufactured goods. The country’s most important export partners are other EU countries, including Germany, France, the UK, and Belgium.
The Netherlands is an excellent location both as a source of goods and a destination for US exports.
The Netherlands’ trade is relatively balanced, with imports totaling at $402.9 billion. The most important commodities brought into the country are clothing, foodstuffs, machinery and equipment, chemicals, and fuels. The US is the Netherlands’ fourth import partner, outranked by Germany, China, and Belgium.
Currently, the US is the largest foreign investor in the country, and has a significant trade surplus ($24.2 billion in 2016). The Netherlands is an excellent location both as a source of goods and a destination for US exports.
The Netherlands is a parliamentary constitutional monarchy. Its mainland territory comprises of 16,040 square miles, and has a population of 17 million people. Population density is 1,071.5/sq mi (compared to 90.6/sq mi in the US). Urbanization is quite high: 91.5% of inhabitants live in urban areas.
The main ethnicity of the country is Dutch (78.6%). There are significant minorities from other EU countries (5.8%), Turkey (2.4%), Indonesia (2.2%), and Morocco (2.2%). The majority of the population (50.1%) doesn’t belong to any religion. The rest is divided between Christianity (44%), Islam (5%), and other religions like Hinduism and Buddhism.
Amsterdam is the capital and most populous city of the Netherlands: 1.3 million people live there. The city is the commercial center of the Netherlands, and one of the top financial cities in the EU. Many large banks and international companies have their headquarters in the city, including Philips, Heineken, ING, Deloitte, and Booking.com. The Port of Amsterdam is an important trade hub. Together with Rotterdam, Utrecht and the Hague, Amsterdam forms the Randstad, one of the largest megalopolises of the EU with over 7 million inhabitants.
With over 990,000 inhabitants, Rotterdam is the second largest Dutch city. The Port of Rotterdam is the largest port in Europe. Due to its strategic location on the seaside as well as the rivers Rhine and Meuse, it’s an ideal European starting point for all shipments arriving over the Atlantic and traveling on to Western and Central Europe. Rotterdam is home to companies like Unilever, Robeco, Allianz, Shell Downstream, and Pfizer.
Although Amsterdam is the capital of the Netherlands, the seat of government is in The Hague. Along with the Dutch government, the city hosts a number of international organizations, including the International Court of Justice, the International Criminal Court, and Europol. With government and international organizations as the largest employers in the city, there’s a significant services sector catering to the needs of civil servants.
As a member of the eurozone, the Netherlands uses the euro as its official currency. The value of USD is usually behind the euro. In fact, 1 euro is generally worth between $1.1 and $1.4 USD.
93% of Dutch people can speak English fluently
The official language of the country is Dutch. Frisian, English and Papiamento (spoken in the Caribbean constituent countries) have the status of recognized regional languages.
According to a recent study, 93% of Dutch people can speak English fluently. It’s highly unlikely that you’ll need an interpreter for your negotiations with Dutch business people.
Holidays in the Netherlands
There are nine public holidays in the Netherlands.
|New Year (Nieuwjaarsdag)||January 1||Nationwide|
|Easter Sunday (Eerste Paasdag)||First Sunday after first full moon occurring on/after spring equinox||Nationwide|
|Easter Monday (Tweede Paasdag)||Monday after Easter Sunday||Nationwide|
|King’s Day (Koningsdag)||April 27||Nationwide|
|Liberation Day (Bevrijdingsdag)||May 5||Nationwide|
|Ascension Day (Hemelvaartsdag)||40 days after Easter||Nationwide|
|Whit Monday (Tweede Pinksterdag)||7 weeks after Easter||Nationwide|
|Christmas Day (Eerste Kerstdag)||December 25||Nationwide|
|Boxing Day (Tweede Kerstdag)||December 26||Nationwide|
Communication from the US
Email is a common form of business communication in the Netherlands. Since Dutch people are straightforward and like to get to the point as fast as possible, no small talk or pleasantries are expected in emails.
Making calls from the US
The international country code for the Netherlands is +31. If you want to make a call from the US, follow these steps:
- Dial 011 to exit the US;
- Dial 31 for the Netherlands;
- Dial the 9 digit phone number. If you’re calling a cell phone, the first of those will be 6.
- Example: 011-31-xx-xxx-xxxx.
Finding a business partner in the Netherlands
If you’re looking for a business partner such as an importer, wholesaler, distributor, or agent, the Dutch Chamber of Commerce is happy to provide you with assistance. Additionally, the US Commercial Service can help you plan your export strategy, look for partners, and market your products in the Netherlands.
Traveling to the Netherlands
Denmark uses Central European Time Zone (CET), which is UTC + 1 hour. Amsterdam is 6 hours ahead of Washington, DC. Cars drive on the right side of the road. The Netherlands uses the metric system.
Since the Netherlands is a member of the EU and a part of the Schengen Area, you won’t need a visa if you plan to stay in the country for less than 90 days for business or touristic purposes. The only thing you need is a US passport that’s validi at least 6 months after you leave the Netherlands.
If you plan to stay longer, apply for a visa at the Embassy of the Netherlands in Washington, DC.
Using a Cell Phone in the Netherlands
Cell phone coverage is universal in the Netherlands. You may even use your own phone, provided it runs on the GSM 900/1800 network European countries use. However, since roaming costs are very high, it’s recommended you buy a Dutch SIM card, and even a cell phone, if you plan to make and receive many calls during your stay in the country.
It’s worth knowing that the European Union has banished roaming costs for EU cell phones within its territory. This means that if you buy a SIM card in any EU country, you’ll be able to use it in all other EU countries without roaming charges. In the Netherlands, you can buy a prepaid SIM card in any phone shop. There are four main cell phone carriers in the country: KPN, Vodafone, T-Mobile, and Tele2.
Free wifi is available in many restaurants, cafes, tourist information centers, as well as on public transport.
Internet connectivity won’t be an issue anywhere in the Netherlands. Free wifi is available in many restaurants, cafes, tourist information centers, as well as on public transport.
Major Trade Shows
Participating at a trade show provides you with an excellent opportunity to showcase your business, and find new customers as well as potential business partners. Here’s a list of the most important Dutch trade shows.
|TEFAF Maastricht||Maastricht||Spring||Arts and antiques|
|Stoffen Spektakel Rotterdam||Rotterdam||Spring and Fall||Textiles and fabrics|
|HUISHOUDBEURS||Amsterdam||Winter||Homes and interiors|
|VSK||Utrecht||Every 2 years||Heating, air-conditioning, sanitary equipment|
|HORECAVA||Amsterdam||Winter||Tourism, hotels, restaurants|
|Europort||Rotterdam||Every 2 years||Shipbuilding and marine equipment|
|Solids Netherlands||Rotterdam||Every 2 years||Bulk products, powders, granules (including food and beverages, animal feed, cosmetics and chemicals)|
|PCI Benelux||Amsterdam||Winter||Payment security, protecting payment systems|
|Amsterdam International Fashion Week||Amsterdam||Winter and Summer||Fashion|
|Beauty Trade Special||Utrecht||Spring||Beauty and hair|
Honesty and straightforwardness are valued above pleasantries and white lies.
Dutch culture is based on Calvinist notions where respect is earned through hard work instead of age or hierarchy. Honesty and straightforwardness are valued above pleasantries and white lies. Since everybody is equal, flashiness and a blatant display of wealth is usually frowned upon. Dutch houses and cars tend to be simple and functional despite the generally high wages and living standards.
As the Netherlands has an egalitarian society, business hierarchies are typically flat. The manager is usually seen as part of the team, just as important as anybody else in the business. A manager making coffee for themselves is not an uncommon sight in a Dutch business.
A manager making coffee for themselves is not an uncommon sight in a Dutch business
Communication in the Netherlands is straightforward and blunt. Negative feedback is given freely and without cushioning. Don’t shy away from this. In fact, Dutch people expect others to point out their shortcomings and are not hurt by it at all. Don’t take offence when your Dutch supplier has less than favorable feedback for you. They don’t want to hurt your feelings; it’s simply the Dutch way of communication.
Dutch people are generally low-key in tone and body language. Try to tone down your gestures and voice as well to match theirs. Social distance is generally 50 cm (about 20 inches).
The First Meeting
Even though Dutch business culture is relatively informal, first meetings are a bit of an exception due to the lack of history between you and your prospective supplier. When preparing for the first meeting, err on the side of formality regarding dress code and tone.
Dutch employees may even wear jeans and sneakers to work (especially if they commute to work on the Netherlands’ favorite means of transport: the bike)
Dutch business people generally prefer less formal attire than others. Unless they have a meeting scheduled, Dutch employees may even wear jeans and sneakers to work (especially if they commute to work on the Netherlands’ favorite means of transport: the bike). Attire depends on the industry as well: banking or civil service employees tend to dress more formally. When in doubt, err on the side of formality.
Time is an important consideration for Dutch business people. Schedule your meeting well in advance and try to be as punctual as possible. Being more than 10 minutes late is considered very rude.
Dutch business meetings usually run according to a previously circulated agenda and tend to finish as scheduled.
Dutch people value their free time and try to spend it with their families or friends. Calling a person outside of working hours, or scheduling a meeting near the end of the workday, is quite uncommon in the Netherlands.
When meeting for the first time, it’s best to have a third person introduce you to your prospective partner. If that’s not possible, you may introduce yourself. A firm handshake and extensive eye-contact is the norm for Dutch people. Handshakes are customary when leaving a meeting as well. Friends and close acquaintances may greet each other with three kisses on alternating cheeks.
Formal titles are not used in everyday conversations, unless your counterpart is a university professor or medical doctor. It’s best to call your Dutch supplier Mr. or Ms, until you’re invited to address them by their first name. Since Dutch people tend to prefer first names, you’ll be invited to a first name basis quickly.
There is no ritual associated with the handing over of business cards. It usually happens towards the end of a meeting. However, Dutch business people are fond of giving out their business cards, so make sure you have your own card on you.
Dutch people don’t like formal titles, their business cards tend to feature titles they earned by completing a university degree
Interestingly, although Dutch people don’t like formal titles, their business cards tend to feature titles they earned by completing a university degree, for example doctorandus (drs) or ingenieur (ir). When addressing a person, you don’t need to use these titles.
Generally, very little small talk is expected. Since business meals are not very common (and if they do occur, the topic of conversation tends to be business-related), you won’t be required to come up with lots of topics for small talk. However, if you find yourself in an elevator with your Dutch business partner, you can safely discuss the weather, sports, arts, high culture, movies, or your impressions of the Netherlands.
Gift-giving is not a part of Dutch business culture. Dutch people don’t like to feel obligated, and receiving a gift means they’re indebted to you. However, when an important milestone is reached you may offer a small and neutral gift to your business partner. Note that items with your company logo are not considered to be an appropriate gift. If you receive a gift, you can open it in front of the gift-giver.
Dutch people rarely invite their business partners into their homes. Should that happen, consider it a great honor and make sure to bring a small gift for your host; a bouquet of flowers or a bottle of wine is perfect for any occasion.
Dutch business people love meetings as they provide an excellent venue for the exchange of opinions. Since employees are encouraged (and even expected) to share their ideas and assessments, meetings can be longer than in the US. Expect an honest and straightforward exchange of ideas and feedback, and don’t take it personally if a negative opinion is voiced. In fact, feel free to share your own ideas and potential objections as honestly and directly as you feel comfortable with.
Decisions are made only after all parties’ opinions are heard
Agendas are drafted for meetings and they’re usually adhered to. By the way, Dutch people respect the written word: once a contract is signed, your Dutch supplier will most likely want to stick to it. After a meeting, minutes or memoranda are circulated. Sending a prompt follow-up to your business partner with clear task distribution and benchmarks will definitely impress them.
The Dutch process of negotiation may seem a little slow at first to Americans. Since the Netherlands believes in egalitarianism, decisions are made only after all parties’ opinions are heard. Depending on the size of the organization and the comprehensiveness of the topic at hand, coming to a collective decision usually takes more time than what we’re used to. However, try not to appear impatient or rush the process as it won’t help your cause at all.
Regulations and Permits
Since the Netherlands is a member of the European Union, all Dutch imports and exports are subject to EU tariffs and regulations.
Exporting to the Netherlands
If you wish to export to the Netherlands, you can either find a Dutch import partner who will take care of everything on their side of the border, or you can do it all by yourself. Although the latter is definitely more work, it also provides more freedom regarding pricing, distribution, and more control over the whole process. If you choose to go this way, here’s a step-by-step guide for you to follow.
First, you need to obtain an Economic Operators Registration and Identification (EORI) number. You can do this either by contacting the Dutch border authorities, or asking for help from the EU Delegation in Washington, DC.
The EU classifies all products entering its territory according to a complex coding system. This includes the Harmonized System (HS) devised by the World Customs Organization, the EU’s own coding system called the Combined Nomenclature (CN), and the Integrated Tariff (TARIC). This latter contains all relevant information about EU trade and customs policy as well as tariff measures.
Although this sounds very complicated, there’s no need to worry. The only thing you need to do is go to the EU Trade Helpdesk’s website and choose your goods from the useful tool they’ve provided for exporters. The database gives you the applicable codes, as well as all the information about tariffs, fees, and possible additional local duties. (Although the database currently doesn’t include the US, you can still use it by choosing any country as the country of origin since tariffs and rules are the same.)
The import of some products to the EU is limited by quotas. You can check here whether that applies to your goods.
When your products arrive at the EU port of entry (or even before that), you have to file customs declarations for them. You can do so electronically, or send a Single Administrative Document (SAD) along with your products.
Once you declared your products for customs and the Dutch border authorities have inspected your paperwork as well as the goods, you need to settle duties and any other fees before your products can be released from the border.
Importing from the Netherlands
A basic tariff fee (less than 3%) applies to all products imported from the Netherlands to the US. The Customs and Border Protection (CBP) is the agency responsible for handling all customs processes at the port of entry.
If you’re thinking of importing your supplies from the Netherlands, you need to follow all US customs regulations and procedures. The CBP’s website informs you about all the necessary steps you need to take to successfully import products to the US.
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Whether you’re exporting to or importing from the Netherlands, paying your Dutch business partner through Veem is the best option if you’re looking for a fast, convenient, and totally secure payment method.
Receiving a transfer in the local currency (in this case, euro) is beneficial for the recipient and beats waiting around for favorable FX rates on the market.
Tackling international payments can be a hassle if you choose to do it the usual way, via bank transfer. There are countless uncertainties in the process, including when the transfer arrives, how much will be deducted from the original amount due to many hidden intermediaries, and what rate of foreign exchange the banks will use.
Veem uses unique multi-rail technology that allows you to track all your transactions. Since we connect with both sender and recipient, there are no more misdirected payments. All parties are on the same page and know all the necessary details (scheduling, fees, amount) of the transaction.
Our foreign exchange (FX) rates are the best on the market, and since we cut out the middlemen, there are no hidden costs nor any unknown transaction fees associated with the process. Receiving a transfer in the local currency (in this case, euro) is beneficial for the recipient and beats waiting around for favorable FX rates on the market. If your Dutch partner is sending you a payment, remember to select USD instead of euro as your currency.
Choose Veem and let us take the burden of all your international transfers off your shoulders.
How to find a Dutch supplier
Visas and general travel information
Exporting to the EU
European Commission: Quotas
European Commission: Trade Help
European Commission: The Combined Nomenclature
European Commission: TARIC
European Commission: Economic Operators Registration and Identification Number (EORI)