The Dutch are entrepreneurial and like to do business across the border. The Dutch government helps SMEs with this. In this series, we follow Herco Hekking, an entrepreneur from Overijssel. Hekking plans to export dairy processing equipment to Tanzania. Part 2: Preparing for investment with a subsidy.
“A doer rather than a thinker.” That is how Herco Hekking – the owner of Ante B.V., a family business with 7 employees – describes himself. Ante markets dairy processing equipment in close cooperation with Jurry Hekking Metaal B.V., the company owned by Hekking’s brother. Together, they manufacture and sell relatively simple and low-maintenance dairy processing equipment to mid-sized dairy farmers. Ante focuses specifically on farms in Asia and Africa. “As a Dutch company, we are relatively expensive for customers in those areas compared to our competitors in India and China. To stay competitive, we offer not only new but also refurbished equipment, including service and repairs.”
To invest or not to invest
In late 2019, Hekking applied for a DHI subsidy from the Netherlands Enterprise Agency. “At that time, we were already exporting equipment to Tanzania and facing an increasing demand for service and maintenance.” This led to the idea of opening a branch facility for assembly and servicing in Dar es Salaam. “From there, we could potentially train maintenance technicians to carry out maintenance work on our equipment in Kenya, Uganda and Rwanda as well. The branch facility staffed by Tanzanian colleagues could be managed by a Tanzanian partner.” One problem: the cost of setting up this kind of local hub is around €250,000 – quite a lot of money for a relatively small company like Ante. “We wanted to find out if our idea was technically and economically feasible, so we applied for a subsidy to support an investment preparation project.”
For 4 months, Ante B.V. employees conducted all kinds of research. They asked themselves questions such as: what do we need in the workshop? What are the safest supply routes for materials? Which legal aspects will we need to consider when establishing a local branch? How do we find the right people, and how do we train them? A business plan based on the results of the research is currently being made. Hekking will be able to use this plan to request funding. “We now know that opening a local branch will be worth it. We have teamed up with a local partner to set up business in a leased building.”
The biggest surprise they encountered was the knowledge already present among the technicians. “They had a great deal more expertise than we expected. That is why we not only intend to export new equipment from the Netherlands to Africa, but have the local employees refurbish used equipment and prepare it for sale, too. We expect that this will enable us to double our revenue in Tanzania within 3 years.” In other words: mission accomplished.
Tip: contact the embassy
Hekking has some advice for SME owners with international ambitions: “When you travel abroad for business, always stop by the local embassy or trade representation. The people working there have professional expertise and can help you by giving you useful tips or contacts that you may not have thought of yet. Once they know you, they will get in touch when they come across local opportunities. Also, take advantage of the subsidy schemes – they are not just for big businesses. DHI can help you take the next steps.”