Survey : How to sell in the UK

British market

Even with a “hard Brexit”, United Kingdom will remain one of the best client for European companies.

United Kingdom has a population of 65 million. British people are open to foreign products. Well-informed customers, they smartly compare before buying : sales cycle might be slow.

A business presence in the UK will facilitate the access of any European company to Commonwealth market (54 countries).

What type of commercial development in the UK

The type of commercial development in the UK depends on your budget

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1- Distribution network

The main advantage is that a distribution network reduces your initial investments. Be careful about the legal cost (solicitor). You have to plan the cost of a solicitor to assist you with the distribution contract regarding the British rules.

  • The main disadvantages of a distribution network are :
  • Not easy to know your clients / customers expectations because you are not in direct contact with them
  • The distributor doesn’t always know about your product
  • You need to control / animate the distribution network
  • A “divorce” is never easy (in case of the distributor incompetence)

2- British freelance sales representative working only for you

Advantages of a British sales representative are :

  • The cost of her / his work remains under control since she / her is paid on achieved resultvendre en angleterre
  • The client data base is known
  • All her / his time is devoted to the development of your business

Disadvantages of a British freelance working only for you

  • In case of termination of your commercial contract with the British freelance, she / he can legally claim a compensation.
  • HMRC will re-qualify the commercial contract you have with this “single-client” freelance as an employment contract. Then

– you will be recognized as her / his employer

– you shall pay NIC on all her / his previous invoices

3- British freelance sales representative working for you and also having other clients

The cost of her / his work remains under control since she / her is paid on achieved result. In addition the client data base is known.portage salarial angleterre 2

Warning : It is strongly recommended to be assisted by a British solicitor for the drafting of the commercial agreement (extra cost). The commercial agreement shall include the following points :

  • Duration
  • Sales commissions calculation
  • non-competition (the freelance shall not represent other companies in competition with yours)
  • Define territory of your freelance

Disadvantages of this freelance (having several customers) are :

  • She / he will not spend all her / his energy and time to promote ‘your’ products / services
  • In case of termination of your commercial contract with the British freelance, she / he can legally claim a compensation

4- Secondment of a European employee to the UK

Advantages of secondment are :

  • Continuity of home country employment contract and the internal rulesexpatrie en angleterre
  • You know your European employee competencies
  • The client data base is known
  • All her / his time is devoted to the development of your business
  • Customer expectations easily identifiable

Disadvantages of this secondment are :

  • Limited duration in the EU (currently 24 months)
  • Higher investment than the British freelance (salary and accrued expenses even if targets result not achieved)
  • Your European, but non-British, employee might have a limited knowledge about the UK market
  • Your seconded employee is not allowed to invoice, to receive the original orders or to commit the company

IMPORTANT 1 : DO NOT FORGET to extend your Employer Liability Insurance to the United Kingdom

IMPORTANT 2 : The future agreements on Brexit will probably change the secondment rules in the UK

5- Special European status for young graduates

Some European countries allow their young graduates working in other EU countries for a limited duration whilst they are covered by the National Insurance of their home country. Example : VIE (Volontariat International en Entreprise) which is a French status. The company can therefore begin its business develop in the UK with this “young graduate” at a very low cost. The disadvantages of this type of system are the age limit as well as a limited duration

It is not sure that this status will be maintained with the future agreements on Brexit.

6- Employment contract outsourced by a British company (our approach)

In this scheme, you will first identify the sales representative who can develop your business in the UK.

  • You agree with her / him about the remuneration package and other conditionsemployment 2 uk
  • She / he will sign an employment contract with the British company who becomes her / his employer in the UK.
  • You will also sign a commercial agreement with the British company (consultancy agreement). You will manage him directly as a ‘consultant’ and she / he will develop your business in the UK.

Advantages of this scheme are :

  • The client data base is known
  • Your ‘Rep’ (employee) knows the British market and the British culture
  • All her / his time is devoted to the development of your business
  • The British company (not you) has to deal with the UK obligations : administration, tax, accounting and social contributions (NIC) …
  • No time limit
  • You will test your ‘Rep’ (employee) without any ‘direct employer liability’

Disadvantages of this scheme are :

  • Higher initial investment (probationary period) than the British freelance (salary and accrued expenses even if targets result not achieved)
  • Your ‘Rep’ is not allowed to invoice, to receive the original orders or to commit the company

7- Employment contract outsourced by a British company (our approach); but instead of a British sales representative, you choose a European employee

In this scheme, you already know your European employee.

  • You agree with her / him about the remuneration package and other conditions of her / his expatriation
  • You will temporarily suspend her / his initial employment contract and send her / him to the UK as an expatriate
  • She / he will sign an employment contract with the British company who becomes her / his employer in the UK.
  • You will also sign a commercial agreement with the British company (consultancy agreement). You will manage him directly as a ‘consultant’ and she / he will develop your business in the UK.

Advantages of this scheme are :

  • The client data base is known
  • All her / his time is devoted to the development of your business
  • The British company (not you) has to deal with the UK obligations : administration, tax, accounting and social contributions (NIC) …
  • No time limit
  • You will test your ‘Rep’ (employee) without any ‘direct employer liability’
  • You already know you ‘Rep’ and don’t have to test her / him.

Disadvantages of this scheme are :

  • Even if you were satisfied with this ex-employee in your home country, this ‘Rep’ might have adaptability problems with British clients because he might not know the British habits and the British market
  • Higher initial investment (probationary period) than the British freelance (salary and accrued expenses even if targets result not achieved)
  • Your ‘Rep’ is not allowed to invoice, to receive the original orders or to commit the company
  • Your ‘Rep’ (employee) knows the British market and the British culture