Possibilities for support when getting established on the American market
Carl Johan Mørck from the company Carlsen Europa A/S has had good experience of working with DIBD who has carried out comprehensive feasibility studies and raised financial support for the entire process.
-To put it simple, it has given us better qualifications in relation to getting established in the USA, compared to the qualifications we had when we moved the production to Eastern Europe, few years ago. We have received continuous assistance and we are far better prepared to handle American customers compared to our European competitors, says Carl Johan, CEO and owner of Carlsen Europa A/S, about his experience with DIBD. Carlsen Europa produces lightweight deep freeze bodies for home delivery of frozen food. In Denmark they might better be known for the cold store boxes on “HjemIs-bilerne”, but their largest markets are outside of Europe, where their bodies are mounted on more than 3.500 cars.
The production moves to Lithuania
Four years ago, Carlsen Europa moved their production from Funen, Denmark, to Lithuania and also then, they received assistance from DIBD regarding the feasibility study and the full business plan. After a couple of instructive years in Lithuania, Carl Johan Mørck and Carlsen Europa were motivated, again, by an old dream of getting a commercial breakthrough in the USA.
So far, Carlsen Europa’s sales to the USA have been moderate, primarily due to a fundamentally different tradition in design in the USA, where things are designed larger and heavier. Carlsen Europa saw, however, that the increasing fuel prices in the USA could create an opportunity of getting started on the highly competitive American market. Due to this, Carlsen Europa hired DIBD’s office in the USA to elaborate a market study, which confirmed and documented the opportunities.
Subsidies for the feasibility study
Simultaneously, DIBD in Copenhagen assisted Carlsen Europa in securing access to subsidies for the further feasibility studies. This option has not been available earlier where the focus of these subsidies was on developing markets.
The market potential was already documented and the dollar rate of exchange made it attractive to investigate the opportunity of establishing local production. The result was a longer project progress, during which DIBD’s office in New York City elaborated a thorough plan for establishment of an assembly facility in the USA, inclusive of a profound financial analysis of various scenarios.
-We went from having a lot of ideas about getting established in the USA, based on a lot of unknown factors, to having a sound basis for decision, where even the smallest details and conditions were validated. This provided us with a fantastic starting point for beginning negotiations with the largest potential customers in the USA and to appear serious, professional and a very, very reliable partner. It was sales promotion ranking among the best in the world and DIBD assisted during the whole process. The fact that DIBD has secured funding for the whole process also, has just been a great advantage on top, says Carl Johan Mørck.
He emphasizes that the investment incentives in the USA are extremely good, also. –There is open competition between the individual states in order to create local jobs and this gives foreign investors an outstanding negotiation position compared to the national investment offices under Invest in America.
9 December 2008