Finland - Easy Going Markets and Highly Efficient Business Environment

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Helsinki, 30 May, 2005 — Finland - Easy Going Markets and Highly Efficient Business Environment

While companies that sell ICT products and services know and understand their own portfolio and skills, matching these to a new market is much easier with a little expert help. Moving into a new country to do business is not a complicated process as long as you know what to do. Plans made in isolation can turn out to be less than complete.

The software sector in Finland has a value of approximately 3,800 million euros. Non Finnish companies wishing to carve out a slice of this have two options: to operate from abroad, or set up a subsidiary company, possibly by acquiring an existing Finnish operation. The cost of doing business in Finland is very competitive. The corporate tax rate is one of the lowest in Europe, 26 per cent from 2005. Skills and know-how are available, literacy levels, including computer literacy, are high, and Finns are known for their positive approach to technology.

In software, the essential element is trust. In B2B operations in Finland, it is possible to get access to the end customer, something not always the case elsewhere. One quite clear result of this is that software companies move to a higher position in the value chain. Finland has often been cited as an ideal “test laboratory” for new products and services. People are technically oriented and keen to try new products.

High Quality R&D Infrastructure

The ICT cluster in Finland has been much helped by public investment in high quality research and development of infrastructure, and by one of the world’s most effective schemes for funding research and development activity. Finland also has several unique resources such as Octopus, SoftaTest and FENIX, National Technology Agency of Finland Tekes’ technology programs. The result has been a very rapid growth in the ICT sector over the last ten years.

Octopus is a unique network set up to promote the creation and development of new mobile services. Offering support all the way from initial innovation through development and testing to marketing, Octopus provides companies operating in Finland with an advanced platform for testing new mobile applications and services in a genuine operating environment. SoftaTest offers an extensive contact network which provides access to companies and resources, to joint development programs run by companies and educational institutions, and to services provided by its Mobile Lab.

The primary goal of FENIX is the development of user-friendly application technologies and products or services for consumers, corporations, and public bodies. In its mission statement, targets of the FENIX program are said to be product based businesses and projects which “contribute to competitiveness and know-how in the long run”.

Commenting on the program Klaus Oesch, FENIX Program Manager, said “This is investing in the information society, not just technology, in the way people educate themselves in the information society. It is also about communities, how they are developing and creating content. FENIX is certain to provide new openings and opportunities for product development and new applications.”

Expert Advice and Assistance

Invest in Finland is a government agency whose task is to provide help and assistance to companies who wish to establish operations in Finland. Many of the questions asked by Invest in Finland’s clients are of a down-to-earth nature - such as the cost of renting office space. There are more general questions: What about languages, levels of computer literacy? How does staff recruitment work? Other queries are more specific: Are there reliable sources of information on consumer or company behaviour?

Invest in Finland offers assistance in researching alternative ways to establish or expand a presence in Finland. Questions, that Invest in Finland is in a unique position to provide assistance with, include those concerning salary levels and labour costs, the types of support that are available, and the best ways of expanding into Finland - opening a sales office, acquiring a Finnish company, setting up a research and development facility and/or manufacturing unit, or expanding existing operations.

Successful Entry to the Finnish market

In the middle of December 2004, city of Lappeenranta based Technology Center Kareltek Inc. (Kareltek) signed a cooperation contract with Ardin Software Oy, a Russian-owned company which has been operating in the Helsinki Metropolitan Area for two years. Ardin Software works in close cooperation with the Russian company Arcadia Inc. providing software services for clients located mostly in Scandinavia. Ardin Software also represents other Russian companies that work in the same sector.

Ardin Software’s second step has been an expansion in Finland and moving to Technology Center Kareltek. “Establishing a business in Lappeenranta helps us assist local companies in creating connections with Russian high-tech companies and research facilities. We can act as a channel between local and Russian companies and offer top Russian expertise. We will also be hiring local people to take care of our business here”, tells Arcady Khotin, Managing Director of Ardin Software Oy, a St. Petersburg-based software company

“Every Day Offers Something New”

Khotin is pleased with the assistance received in Finland. “Invest in Finland did an excellent job for us. Without them we probably would not have dared to come. They gave us a lot of useful information”, tells Khotin and adds, “Finland is not a corrupt country. I received fair treatment. For me, every day here offers something new. It gives me energy. I love it.”

Future prospects for the Finnish ICT sector, and Ardin Software’s business, look bright. According to a report on software sector prospects published in December 2004, 75 per cent of the software companies operating in Finland expect their turnover to increase. In Khotin’s words: “The industry is warming up again, the demand is here”.

Website Service for Investors

As part of its website, Invest in Finland has an on-line service that enables companies to register at the site for free and request information packages on specific sectors or areas of investment.

Invest in Finland helps foreign companies to locate in Finland and take advantage of the region’s competitive business environment. It works as an efficient link between foreign and domestic companies and it provides all the information required to establish a business in Finland.

Atso Vainio
tel. +358 9 6969 2525

Taneli Saari
tel. +358 9 6969 2527

The article is published in ICT Cluster Finland Review 2005.

More information
ICT Cluster Finland Review 2005