Category: All International growth
Keywords: Business culture, Finland, international expansion, International Growth Case, Market entry
Author: Kim Kisenja
Successful business negotiation in Finland
Finland with its 5.5 million population, high incomes and stable economy is a considerable trading partner for many EU countries. To its neighbours, Finland is an important export and import partner, which makes interaction with Finnish businesses and investors frequent. Finland is quite Helsinki centric, with the share of 38% of the total GDP and 30% of the total population (European Commission, 2017). The country’s other dynamic business hubs are Oulu, Tampere and Turku.
In Excedea we have had many discussions with clients from the Baltics and Nordics who have business in Finland already, but feel that their business could be bigger than it currently is. The initial interest is turning into a dragging process for some reason, which eventually provides little results or dies out. Typically, there is one important ingredient that has gone slightly wrong in the communication.
Top 2 aspects for ensuring successful negotiation in Finland
Our experience shows that you can significantly increase your outcome from the business discussions and sales in Finland if you 1) show trustworthiness, and 2) are open about your business. The challenges emerge as an outcome of poor communication and lack of trust between the parties. For Finland, these points are especially important because of the soft bargaining culture and realistic starting point in the negotiation. The same is expected from its counterparts and if the gap between realistic demands and the counterparts’ initial request is too big, then the discussion is deprioritised.
There are jokes and legends about ”Finnish silence” during the meetings, however, these are more fun facts.
How to negotiate with the Finnish partner?
To improve the discussion with the Finnish partner, focus on showing your trustworthiness i.e. expertise, references and acting exactly as promised to the partner before. Consistency in the communication, price formation and other factors, is very important. For example, we participated in one negotiation, where Finnish investors wanted to buy a property in Tallinn. Throughout the process, the Estonian seller changed their view, input numbers and brought-up extra costs. Obviously, the discussion died. Usually, the discussions start with substantive trust credit. Deviating from your initial promises like price, additional costs, delivery terms etc. will bring the trust down and hinder further steps, of course, if there will be any.
Try describing the logic of operating principles and be consistent and honest about your business. There is constant win-win search and it is fine to debate about the price, schedule and activities. It is also very OK to state that there is no business for you with current terms. Typically, a solution-oriented discussion tolerates that and there is still a possibility that you will reach an agreement.
Our suggestion to anyone working with Finnish partners would be to invest in communication, be open, straightforward and consistent. Establishing trust and feeling of win-win is important everywhere, but crucial in Finland.
If you are interested to discuss this topic further please email Kim Kišenja.