SubscribeThe last decennia, the removal of trade barriers and new technological developments have made transporting goods easier and cheaper.
The concept of a global economy is becoming a reality. The whole world has now become the market.
In order to be able to continue to compete in this dynamic market, it is essential for companies to be able to react to changes and to keep looking for the most efficient way of running a business. The Netherlands responds quickly to the changing market dynamics in logistics and acts as the leading Gateway for Europe.
The Netherlands in European logistics
The Netherlands has always had a powerful attraction for companies wanting to set up a European Distribution Centre. At the present time, over 50% of the EDC's based in Europe are located in the Netherlands. It has invested a lot of resources in maintaining and improving the existing infrastructure of roads, railways, inland waterways, ports, airports and pipelines. In addition, the country has a central location within Europe, among the most important markets and business centres: there are over 170 million consumers within a 500-kilometer radius.
A favourable location
- Infrastructure
The Netherlands has excellent port and airport facilities. The port of Rotterdam and Amsterdam Airport Schiphol are respectively number 1 and number 3 in cargo in Europe. Transport costs from intercontinental sources towards the main ports are low and the connections to other European regions are frequently due to the different modalities that are used (truck, train, short sea and barge).
- Fiscal Aspects
The fiscal aspects are important in sectors with high value density products. The Netherlands will decrease its corporate tax to 25.5%.
- Labour
- Flexibility of part-time labour
- Multilingualism
- Availability of labour
- Customs
The Netherlands is one of the few countries that actively implement a cross border bonded warehouse license. For regional DC's with a central control it has the advantage that one central expertise team can handle all custom affairs with one Dutch customs authority for all the operations in the different countries. This license facilitates the flexibility that is needed in supply chain management.
- Accessibility
Companies have rapid access to Europe's principal economic regions, including Paris, Frankfurt, London and Berlin. The country's specific qualities, such as its internationally oriented economy, its stable political climate, its mature financial sector and its multilingual workforce, play an important part in this regard.
From EDC to ELC
Traditional supply chains are changing into complex, centrally controlled, demand driven networks in which the geographical location of inventory is not crucial. In line with such changes traditional EDC's are developing another role in the supply chain. In addition to adding value as a stock location, they are also becoming service centres for the whole supply chain. Examples of the latter context include stock planning, customs declarations and customer contacts. As a result the term EDC is no longer particularly applicable in many cases. A more appropriate term for such operations is European Logistics service Centre (ELC).
Value Added Logistics (VAL)
In spite of being one market, Europe is still very fragmented. Different languages, tastes, cultures, habits and regulations have an influence on the requirements of the product. To be able to be responsive to the local demand and at the same time take the specific requirements into account, a manufacturer should customize the product as late as possible in the supply chain.
The response to this challenge of the logistics industry in the Netherlands was value added logistics (VAL). VAL is based on postponed manufacturing. Instead of storing the final product in the distribution center, generic components or sub-assemblies are stored. The final assembling activity is taking place based on the specific customer order. Products are made customer or country specific at the latest possible moment in time. The advantage is that companies can offer a higher responsiveness towards the market.
Successful European logistics
Effective logistics have become the difference between success and failure in the very competitive, but potentially very rich and rewarding, European market. This is forcing companies to (re) assess their current logistics set-up in Europe. Agile and flexible logistic structures are needed to handle market dynamics. Specialist logistics companies will have to offer agile, high quality and cost effective solutions.
The Netherlands Foreign Investment Agency, in cooperation with Holland International Distribution Council (HIDC), assists international companies to make a successful entry into the European market through the region's leading gateway, the Netherlands. Holland International Distribution Council (HIDC) is matchmaker for logistics partnerships and represents the logistics sector in the Netherlands. Please contact us to for further information discuss possibilities for your company.
(Source: HIDC)