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2nd Meeting of Economists from Podravje Region, Ptuj, 24 January 2014

The American Chamber of Commerce – AmCham Slovenia on Friday, 24 January 2014 already for the second time organized a meeting with the economists from Podravska region. Among other they discussed the internationalization of the Slovenian economy and about the fact that the power of economy is particularly in integration.

The topic of the Round table was:

  • The Internationalization of the Slovenian Economy – Is Its Power in Integration?
  • Is the Key to Successful Penetration of the US Market in the Integration of Slovenian Companies as Practice shows in Austria?
  • How to Penetrate into the Competitive Markets with Innovative Products and Projects?
  • In What Way Can We Involve Ourselves in the Supply Chains of Multinational Companies?

The distinguished guests who tried to answer the questions were:

  • David Burger, Deputy Ambassador of the United States of America to the Republic of Slovenia
  • H.E. Dr Clemens Koja, Ambassador of the Republic of Austria to the Republic of Slovenia
  • Dr. Marko Likon, General Manager, Insol and winner of Energy Globe National Award
  • Mag. Kerstin Draxler, ACStyria Autocluster GmbH, AutoMotive Cluster Austria Styria

A lot of economists from the region responded to the invitation as they were convinced that they have for the existence and development of their businesses to make an effort by themselves and not to merely wait for their states to help them.

The main message of Friday` s meeting of economists from the Podravska Region in Ptuj was that the key to economic success in the international market is in the integration of companies.

The Small Size of Slovenia Can Be Its Big Advantage

The Executive Director of the American Chamber of Commerce – AmCham Slovenia mag. Ajša Vodnik said that the Slovenian companies can be truly successful only if jointly penetrating into foreign markets. »Slovenia might be a really small country, yet its small size can be at the same time its great advantage, as the integration is thus easier. Therefore, we have in cooperation with the Agency Spirit and the U.S. Embassy recently organized the American – Slovenian “Business Bridge”, at which the U.S. guests could assure themselves of the large amount of knowledge in Slovenia«.

She pointed out the need for cooperation among enterprises, which would bring substantial benefits in the international area to all stakeholders: »Only if Slovenian companies try to together enter the foreign markets, they will be truly successful. Slovenia is very small, which can be a big advantage, because we can be accordingly more connected and responsive. Mr. Žargi as an entrepreneur is in my opinion one of the role models that connects companies for joint penetration in the U.S. or in any other foreign market.

“The U.S. market is a very demanding market, but is giving a lot of references. If you succeed in the U.S., you get references worldwide. However, it should be noted that the USA are not one huge country but are divided into many states and entering each of them has own laws. Therefore, it is very important to preliminary inform the companies before entering the market. It is much easier done by connecting and common search of strategies. So, do your homework before entering the U.S. market”, said Ajša Vodnik.

She also noted an important fact about the specifics of Podravska region: »In general, Slovenia is convinced that the state is responsible for the economy in this region, however you are doing it all by yourselves. You are not waiting for anyone. You enter the foreign markets. This should apply to entrepreneurship in general«.

Creative and Innovative Ideas can Bring a Good Living

Štefan Čelan, Mayor of Ptuj believes that there is no effective economy without connecting also with non-economic institutions. Nevertheless, the European Union intends to invest more than EUR 6 Billion in new public- private partnerships in nine industries, which is according to Čelan the right way: »The European Union has made an important initiative to promote economy and made three important documents:

  • Cohesion policy for the period 2014 to 2020 to promote and to raise the entrepreneurial culture (creativity, entrepreneurial ideas, innovation) – which will be allocated 1 billion.
  • Measure: into the public-private partnerships in nine industries 6.2 billion will be allocated.
  • The EU calls on the entire world to declare the year 2015 as the year of development. It is important that the richer countries would not earmark only subsidies to the poorer world, but that there would be in 2015 a developmental cooperation and integration established instead.

“The key holders of the development abroad are aware that they can no longer impose responsibility for the development on only a handful of people. To simply leave the free market to the economists and by doing it not being able to assist them, is something that does not give the desired results. It can be today seen in all economic indicators. Therefore, we must build a genuine link between the public and private sectors in order to ensure the quality of life for all people in the world, “said the Mayor of Ptuj, who looks forward to such events as they also aim to strengthen the much-needed economic diplomacy.

»Creative and Innovative Ideas Bring a Good Living, whereas the Routine is Destroying – Therefore, We Should Keep It far Away«, concluded the Mayor of Ptuj.

The best thing that a state can do is not to interfere so much in the economy.

In the U.S., the tax structures are low and competitive for business, but nothing is free!

Deputy U.S. Ambassador David Burger to the question of what should a company do to enter the U.S. market, replied by quoting Sandi Češko, a renowned and successful Slovenian entrepreneur: ” In the U.S., it does not matter who you are, where you’re coming from or who you know, but just what idea you have. You do not need friendships or political connections, only a good idea and the right solution for their needs.”

In his opinion, the U.S. market is because of its many opportunities and size easy to penetrate, and it does not matter whether it is a small or a large company. He nevertheless pointed out:»The United States of America are nowadays due to a number of connections and lower transport costs, no longer so far away from you. In addition, the language in Slovenia is not an impediment and Slovenes have many other skills at a very high level. However, before entering the U.S. market, do your homework – investigate all markets in the United States since the rules, legislation, regulation and taxes vary even locally, not only broadly in the states

It is rather harder, in his opinion for the U.S. investors to enter Slovenia, as comparing the two states, the U.S. have long since passed the bureaucratic obstacles and political interference in the economy:

“The level of government interference in the economy necessarily needs to be reduced. The old Yugoslav model was much better than the present one. You also need to reduce the bureaucratic obstacles. The list of 15 companies for privatization is a great start – yet only the start.”

Burger said on Slovenians: »Slovenians have a big fear of failure, which is a huge difference between us. In the U.S. we have no fear of failure, falls and mistakes – if you make a mistake, you analyze it, pick yourself up and move on«.

Burger said about the differences in tax and regulation: »Corporate taxes in the U.S. are really much lower – but nothing is free. Individuals are much more left to their own responsibilities, which is most noticeable in health care, for which they have to pay by themselves. From here derive large differences between people. Nothing is free – including low taxes! However, it is true that the U.S. tax structures are very low, which means that they are very competitive for business«.

Burger’s advice to penetrate the U.S. market: »The bad times can not be the reason that you are looking for penetration “across the big pond”. You should do it also and especially in good times, as well«.

The country needs to liberalize the economic space and stimulate companies to own responsibility.

Slovenia and Austria may cooperate together also in entering the U.S. market.

The Ambassador of the Republic of Austria to the Republic of Slovenia, H.E. Dr Clemens Koja said that Slovenia and Austria have strong economic ties and that there are no limitations for Slovenian companies to enter Austria: »Slovenians have good products and ideas, good concepts, for which you easily succeed in Austria. Figures that prove our cooperation and integration of our economies are amazing, as Slovenia is the largest importer of Austrian products«.

Thus, for our northern neighbors the Slovenian market is very important as there is into it exported much more than in all the BRICS countries (Brazil, Russia, India, China and South Africa) together. Koja also explained that in Slovenia there are at the moment already 700 Austrian companies operating and presented the latest information of the past promotion and presentation of Slovenia and the economic indicators in Vienna, where a great interest has been shown by additional 200 Austrian companies. “The list of Austrian companies in Slovenia is increasing, but there is still space for more cooperation”, is convinced Koja.

Slovenia and Austria may cooperate together also in entering the U.S. market, but it is clear that each country has its own export interests. Connecting businesses on the large markets is in his opinion indispensable especially for those who are just starting to prove themselves, whereas globally recognized brands, such as for example Red Bull in Austria or Gorenje in Slovenia, can enter the market also alone, by themselves. For others, the clustering is important.

As regards the development of Slovenia, Koja is optimistic: “The creativity of Slovenian companies is enormous. We can all see that there is room for optimism and that you will succeed. You are on the right track with the privatization”.

Co-operation is the engine that pulls us forward

Size of a company to enter foreign markets is not important, important is only the interest

The key issue of Friday’s meeting of entrepreneurs from Podravska region was how to internationalize the Slovenian economy. Marjan Žargi, an entrepreneur from Ptuj, MZK Elektro, set out as the key to the issue – the integration between various enterprises: “Only such cooperation, we have practically just begun to execute, denoting the fact that entrepreneurs, who have ideas and give ideas, is the key to success. Entrepreneurs need to start connecting. Co-operation is the engine that pulls us forward. We can not wait. Such events, when we have the opportunity to have foreign ambassadors and the general managers of corporations as our guests, who share with us their experiences is very valuable for us and a great direction for a breakthrough on the international market. The size of a company to enter foreign markets is not important, important is only the interest. If an entity has an interest and an entrepreneur has the interest, then an entrepreneurial story begins. Proof for it are some of the enterprises from the region that do business all around the world”.

Today’s event by the American Chamber of Commerce in Ptuj was also an opportunity when the entrepreneur Marjan Žargi, Manager MZK Elektro, was awarded the award AmChampion for successful years of cooperation. Žargi has a lot of experience with international operations both in Europe and in the United States and is willing to share them with other entrepreneurs.

To penetrate the U.S. market you have to have an open mind and new ideas

“For the success of the company it is also very important that entrepreneurs do not hide their ideas selfishly only to themselves”, said dr. Marko Likon, Director of Insol: “The biggest mistake that we make in Slovenia is that we tend to selfishly keep our work and knowledge to ourselves. On the other hand, we are afraid or ashamed to show our work or expose ourselves. I believe that abroad – even if at first glance – a stupid idea – is able to find buyers.”

“We have been present on the Slovenian market already for quite some time. We are a small company, but we know that in Slovenia there is a niche market for the applied development. Nevertheless, we have come to a point where we realized that the Slovenian market is too small for us and accordingly proposed our ideas to Europe. I feel sad that we could not make it across Slovenian companies, whereas via Brussels we managed to immediately. Since we have learnt from our past mistake of keeping our know-how too much to themselves, we decided to connect three companies together. We immediately moved forward. Therefore we connect with consortia. We decided to sell only our know-how.

However, to penetrate the U.S. market, we knew that we needed to have an open mind and new ideas, because the European market is conventional. When we got in contact with U.S. partners, everything started. In the United States we immediately and honestly say what we have and what we know. In the U.S. you do not hide your knowledge – quite the opposite – you post it publicly in an appropriate professional journal. Therefore, after discovering the operation of poplar fibers, we immediately published everything about it in professional journals and were immediately invited by the International Congress to apply for an international competition, which was attended by representatives of multinationals dealing with these fibers – and were furthermore awarded the European Prize for best practice by the Academic Council! We decided to sell our know-how immediately, but did not have the capacity for all orders. We were helped through the American Chamber of Commerce by the U.S. partners from Acron and we now also achieve capacities”.

The knowledge transfer within organizations is intensive.

Mag. Kerstin Draxler, ACStyria Autocluster GmbH, AutoMotive Cluster, revealed the advantages of such an association: “We are very innovative. Knowledge transfer within organizations is very intensive. The members – 1,080 of them – work together and the transfer of information and technology transfer is not a problem. We try to include companies from other industries, not only from the car industry and use their knowledge and experiences in our industry. Companies within the association are on the market, of course, in a certain sense they are competitors, but in the end they find out that by combining their knowledge everyone gains more.”

The Psychogram of Slovenian Soul and How to Overcome It: »Be Open – Not Only in Your Mind, But in Each And Every Cell«!

“In the last part of the Round Table, Mr Andreas Klisler from the Agency for Development of Carinthia, a native from the Austrian capital Vienna, who is married to a Slovene, in a fluent Slovenian language completed the interesting debate: “I can not say that everything is better by us. I see opportunities for Slovenian companies. They are opening offices in Austria, or even the production and are successful also in other foreign markets. The key is in the integration. I see success in three steps:

  • The integration of the scientific institutions and industry or the integration of science and innovation
  • Have a long-term marketing plan and, of course, means for a sustained success in foreign markets
  • You need to find the right strategic partner

“When I look at the psychogram of the Slovenian soul, I see that it is very important that you are open not only in the mind, but in each and every cell.”