GUEST BLOG: One size does not fit all

By Joanne McEnteggart, director of Business Development, First Names Group

Joanne McEnteggart highlights the importance of providing bespoke solutions to foreign investors looking to expand globally and the positive effects of targeted incentives.

In my experience, one of the keys to Ireland’s foreign direct investment (FDI) success, and indeed our own business at First Names Group, is the recognition that the needs of global companies expanding into Europe are unique and that off-the-shelf solutions won’t cut it.

I know that companies are more likely to engage with service providers who take the time to truly understand their business, including their short, medium and long-term goals, and work with them to arrive at a solution that meets their needs as they grow.

It’s quite common for companies to look for short to medium-term support to kick-off their Irish investment. This support can include incubation services, which give the expanding business the breathing space to recruit the appropriate management team and key personnel for their Irish operation; people who have a business culture and work ethic that reflects the parent organisation.

During these initial critical months, having on-the-ground experts who can look after the set-up and day-to-day operation of the new company means that the business can focus on the big stuff, such as readying a plant for manufacturing.

CORE COMPETENCIES

Interim solutions can take many forms. They may be governance focused, such as providing experienced directors to sit on the Irish board and helping with key decision-making locally. They may centre on fulfilling a finance function, such as cost management, accounting and reporting, ensuring tax compliance, etc. Or they may be designed to deliver a comprehensive administration service to support a full global sales cycle, from invoice generation to product fulfilment.

The pharma and biotech sector is an industry that uses such interim solutions to its benefit. This sector is very focused on fast and efficient go-to market strategies that give them an advantage over their competition.

… companies are more likely to engage with service providers who take the time to truly understand their business, including their short, medium and long-term goals, and work with them to arrive at a solution that meets their needs as they grow

A recent client of ours is a perfect example. The company is a global supplier of generic pharmaceuticals that recently purchased a facility in the mid-west that will be used to carry out R&D and manufacture high-end specialty medications.

While the business gets off the ground, we will take on the role of interim finance director and support the financial and day-to-day administration functions. The company can in turn concentrate on its core competencies until their full infrastructure is in place, when they will gradually take over the running of all aspects of the business.

PROVIDING INCENTIVES

With nine out of the world’s top 10 pharma companies located in Ireland and over 120 pharmaceutical companies operating here, the Irish Government’s commitment to the strategic support of the R&D sector is a smart move.

There are substantial fiscal incentives for foreign investment companies setting up R&D facilities. For example, the Knowledge Development Box was introduced in January 2016 to promote innovation and to provide an incentive by which profits arising from patented inventions, copyrighted software and certain other specific asset classes, can then effectively be taxed at a reduced rate of 6.25%.

This relief is linked to the qualifying R&D expenditure incurred by an Irish company as a proportion of its overall global R&D expenditure.

BUSINESS ENVIRONMENT

Ireland is consistently recognised as one of the best countries in the world for ease of doing business.

I believe this is a testament not only to the country’s pro-business environment, but also to the agility of our corporate service providers in responding quickly to ever changing business needs with ‘best fit’ solutions. The message is simple – Ireland makes business sense.