If you're starting on your own adventure, (taking your business to Europe) you may be daydreaming of a perfect Hollywood movie. But if you're hoping to be a hero or heroine, the relocation process will take much more than a spin of a globe - especially if you're hoping for a happy ending.

The scene is set

Choosing a new location for your business can impact everything from operating costs, to access to new markets, to your company's ability to attract top talentking for greener pastures for a fresare all motivations in any expansion.

Action

Just like the movies, timing is everything. Changes in the marketplace, changes in your company, changes in your industry and even changes in your community's ability to support your business all can lead to a decision to relocate.keep an eye on the enemy.

"When your competitors are planning expansions to Europe, it may be a sign of market growth and time to evaluate a similar move in order to capture your share of the European market," said Hoerhold.

Going on location

Where you move is tricky. Too often the view of Europe from North America is a narrow one. When U.S. businesses consider their European options, they usually start at the same point, said Andreas Dressler, manager with KPMG Strategic Relocations and Expansion Services in New York.

"They have pre-conceived ideas of where they should go," said Dressler. "The same countries spring to mind - the United Kingdom, the Netherlands and France.

"You see the traditional path with companies moving to the United Kingdom. France is another big location, as is the Netherlands."

But that story is changing.

"What we are seeing are regions becoming more aggressive in their efforts to attract U.S. companies - especially Portugal and regions in Germany," said Dressler. "This helps broaden the options for U.S. companies and provides more information. More options are always better, although it might take more time to consider them all."

The script is being rewritten when it comes to where U.S. companies are heading.

"Some of the new places include Berlin and Helsinki," said Dressler. "All of Scandinavia is becoming more of a choice. They have a good high-tech sector, they're bilingual and they're developing a good reputation. Ireland, once at the bottom of the list, is now at the top. It's always on everyone's short list because of a combination of favorable taxes and effective marketing."

A buyer's market?

Acquisitions? Joint ventures? A greenfield investment? How you expand into Europe is as important as where you expand. For companies who have to be in operation within a short period of time, acquisition could be the answer.

"The focus is on finding the company - perhaps a competitor - that fits your growth strategy," said JCG's Hoerhold. "Look for a company with the right product, facilities, customer base, and supply chains already in place."

Joint ventures are usually the choice of smaller companies that need a European partner with local expertise.

"Respective cultures, operating procedures, and management styles must be taken into account," said Hoerhold. "Many joint ventures fail because of differences in these areas."

And finally, for companies with more time, there are greenfield investments. This method is often the choice of larger companies with European experience who feel that it is important to maintain their culture and processes globally.

"In this case, it is the characteristics of the location that are most important, such as proximity to your market; labor cost, quality, and availability; and availability of facilities," said Hoerhold.

The casting call

Finding the right players is always a challenge. You always need to look at the kind of talent needed to do the job.

To check out what the labor supply looks like in a region you're considering, check out key indicators.

How many students graduate annually from local colleges and universities in the disciplines you require? Does labor regularly move into and out of the local market? What are the unemployment rates?

Unemployment rates in the Euro Zone (those countries set to adopt the Euro as their currency, namely Belgium, Germany, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland) fell to 9.4 percent in March, according to the European Commission.

Labor rates in Europe vary greatly from location to location.

The lowest rates are currently in Luxembourg (2.2 percent) and in the Netherlands (2.8 percent), followed by Austria (3.4 percent) and Portugal (4.1 percent). But Spain remains the European Union's highest at 14.9 percent.

A taxing question

There are as many different scenarios for relocating as there are companies.

"Some larger clients shift countries just for the tax minimization," said KPMG's Dressler. "But specific strategies depend on the industry and type of operations.

"In the European Union, all countries must treat all companies equally. But there are special tax rulings for specific types of operations. In France, research and development companies benefit. In the Netherlands, headquarters benefit. And in Belgium, distribution centers get a break."

But tax issues go far beyond just looking for the lowest rates for your specific industry.

"What we see across the board are companies grappling with the tax structure," said Dressler. "How will they integrate their foreign taxes into the current structure? How will they deal with work permits and employee taxation?"

While corporate tax rates are similar across the European Union, some countries are known for their very competitive tax climate.

The plot thickens

The relocation story is a complex one. Hundreds of questions arise with each new step in the process.

How will you set up the company? Should you have a European subsidiary? How will you incorporate the company? What kind of corporate entity will be created and how will it relate to the U.S. company? Will it be a direct subsidiary? How will the management structure be put together?

How will you repatriate profits? Maybe you will have your operations in one country and a holding company in another place, such as Luxembourg, the Netherlands or Belgium, all favorite choices for this arrangement.

How will expatriates acquire work permits? How does the real estate world operate?

These are the types of questions that businesses will have to answer. There are even some that you may not come close to predicting.

"For instance, in some countries there is a regulation that all employees must have access to direct sunlight, so you may not be able to use a building blueprint from the United States," said Dressler. "And in Germany, the permitting process is much more onerous than in the United States. Each location has different considerations.

"We find a lot of U.S. companies thinking Europe is the same as the United States. For instance, they think that the speed of reaction will be the same. Where we can ask for information from a city in the United States and receive it in the same day or the next day, a lot of European regions will take longer than a week.

Production goes overtime

Setting up your European relocation could be a much longer process than expected. Yet, to U.S. companies, speed is almost always an important factor.

"Companies are always rushing," said Dressler. "My advice is to add 50 percent to the time you need. There will be so many factors you didn't anticipate."

Dressler cautions companies to remember that they will be dealing not only with a region or country, but also with the European Union if they decide to locate in one of 15 countries.

"Companies need to remember there is one more level of government," said Dressler. "If you're getting an incentive, for example, it has to be approved by the EC."

On the other hand, sometimes things do seem to operate on fast-forward.

"An Internet company we worked with had an idea," said Dresser. "At the time, it wasn't even a company yet. We worked with them and in two months they had signed a lease in Amsterdam. We helped them narrow their choices down to two choices and did their up-front work."

Roll credits

So, where do you go for help with this monumental task facing you?

The first place to look is the U.S. office of the development agency for the region, city or country you're considering.

"This is a good start," said Dressler. "But their information will be a little biased. You need to get a second opinion to help differentiate."

A consultant might be a good second stop. By merely reading this magazine, you're also taking a step in the right direction.

Star billing?

When you're dealing with agencies, governments and community organizations, keep in mind your future in the area.

Will you be a big company with a starring role in a smaller community? Or will you be more of a supporting player - an average-size company in a major metro area?

Location is an integral part of a successful business strategy - the difference between producing a B-movie and a blockbuster.

The most successful companies are those that use location to their advantage - to gain market position, sustain cost competitiveness and attract the best talent to their organization.

And — action!