Preparing to Export
Taking a Strategic Approach
Doing business with Turkey can be challenging, but taking a long-term and strategic approach is the key to making the process manageable. The first step is to spend some time thinking about your company's Turkey objectives.
The ten questions listed below should help you to focus your thoughts. Your answers to them will highlight areas for further research and also suggest a way forward that is right for your company. You may then want to use this as a basis for developing a formal Turkey strategy, although this will not be necessary or appropriate for all companies.
Sources of Information
Before You Begin
Carrying out the exercise above will help you gain a clearer idea of what you want to achieve, and will enable you to focus your research. However, before you begin, there are some things to bear in mind…
Firstly, there's the geography of the country to contend with. Turkey is big - with an area of 779,452 sq km (300,950 square miles). Turkey borders Greece, Bulgaria, Armenia, Georgia, Iran, Iraq and Syria with easy land and sea access to the Gulf States, Near East and North Africa.
Turkey is divided into seven regions:
Black Sea region
Mediterranean (Southern) region
South Eastern Anatolia
The first four are named for their neighbouring seas; the other three are landlocked. Only Marmara is not wholly within Anatolia. Anatolia is dominated by a high plateau region, rising progressively towards the east and broken by the valleys of some 15 rivers, including the Tigris and the Euphrates and is surrounded on three sides by the sea. There are numerous lakes including Lake Van, which is really an inland sea. In the north the chain of the Ponitine Mountains runs parallel to the Black Sea; in the south, the Taurus Mountains border the narrow, fertile coastal plain. See “Regional Options” in this guide for more detail on the Turkish regions.
Turkey also has many of the characteristics of both a European and a Middle Eastern country. It has to live with the competing cultures of secularity and Islam. It has a rich and varied history and has seen a large number of different empires rise and fall. It is a country of profound national pride but which has some idiosyncrasies born of its unique location as the bridge between Europe and Asia.
Doing Business in Turkey – A profile for success
What is the right approach to Turkey?
The following points illustrate the type of approach that companies doing business successfully in Turkey often take:
You may have been told that Turkey is a "difficult" market or that it's hard to make money there. Yes, things might go terribly wrong, but that is a risk that you take when doing business anywhere. There are many UK companies of all sizes currently doing well in Turkey. There's no reason why yours shouldn't be one of them.
You will be able to find out much valuable free information from carrying out desk research.
A good place to start research on Turkey is the UK Trade & Investment pages of the gov.uk website: www.gov.uk/government/organisations/uk-trade-investment which provides detailed country and sector information. Registering on the website, which is free, provides you with a number of benefits such as access to business opportunities, sector and market reports and information alerts, and enables you to self-manage the information you receive.
There are also many professional and legal firms, as well as private sector consultancies, which provide services to companies looking to do business with Turkey.
UK Export Finance is the UK’s export credit agency. Created in 1919, it has almost 100 years’ experience supporting UK exports and works closely with overseas buyers to help them finance purchases from UK suppliers.
UK Export Finance, a department of the British Government, can help overseas buyers access finance for UK supplies by providing guarantees:
(a) for long term loans, usually repayable over 2 - 10 yrs but can be longer (e.g. for project finance; 14 years + construction period) and;
(b) at competitive rates of interest either at fixed or floating rates.
Although UK Export Finance’s guarantee must be used to purchase goods and/or services supplied by companies carrying on business in the UK, UKEF can also support financing of foreign content. Helping UK suppliers contribute to large projects where goods and services might be sourced from many locations.
UKEF has assisted overseas buyers all over the world on wide ranging projects, including purchase of gas turbines, building of a waste to energy plant, construction of a petrol refinery or hospital, purchase of construction equipment, road vehicles or related services (i.e. consultancy, engineering, architecture, etc) or purchase engines to produce buses, cars and trucks.
UK Export Finance support has helped UK exporters supply to projects from US $1 million to US $20 billion so no project is too big or small. UK Export Finance can consider a range of buyers, from corporate entities to sovereign or public buyers, including Project Financing (inc. BOT/PPPs).
In addition to the above, UK Export Finance can help UK exporters by:
(a) providing insurance against the risk (both commercial and political) of not being paid by their overseas buyer
(b) guaranteeing export working capital facilities and advance, bid or performance bonds from their bank.
UK Export Finance is the operating name of the Export Credits Guarantee Department.
1 Horse Guards Road
Telephone: +44(0)207 271 8010
Sinan Özcan - Istanbul
Regional Director, Europe, Middle East, North Africa & Central Asia
UK Export Finance, Project Marketing Division
The British Chamber of Commerce in Turkey (BCCT) www.bcct.org.tr has a large amount of good quality information on Turkey, and the site provides links to other useful websites. Up-to-date information on political and economic developments in Turkey, as well as information on aspects of doing business there, can also be found in the business press and trade magazines. Credit and financial reports can be obtained for Turkish companies from the British Chamber of Commerce in Turkey (in Istanbul).
Once you have gained a clearer idea of the Turkey market and what you want to achieve, it is time to start making contact with the specialists and exploring what kind of tailored research you might need to make an effective entry into the market.
UK Trade & Investment International Trade Teams
In England, UK Trade & Investment provides support for UK companies through a network of international trade teams (ITTs) based in the English regions. UK Trade & Investment services are also available to companies in Scotland, Wales and Northern Ireland through their devolved administrations; i.e. Scottish Development International (SDI), Invest Northern Ireland (Invest NI) and the Welsh Government (WAG).
As well as providing general help and advice on all aspects of exporting, the ITTs run a wide range of roadshows, seminars and other events on Turkey and other markets. To find your nearest International Trade Adviser, call +44 (0)845 600 9006 or use the database at: www.gov.uk/government/organisations/uk-trade-investment
UK Trade & Investment's Turkey Business Advisers are business executives who provide free consultation and can supply practical advice and assistance on trading with Turkey. The current list can be downloaded from: www.gov.uk/government/organisations/uk-trade-investment
There are also dedicated sectorally focussed Trade and Investment teams at the British Embassy in Ankara, the Consulate-General in Istanbul and the Consulate in Izmir. Your ITA will be in contact with them to discuss your business prospects in Turkey.
Contact details can also be found in the Resources section of this guide.
UK Trade & Investment services for business
Advice and support
Passport to Export – an assessment and skills-based programme that provides new and inexperienced exporters with the training, planning and ongoing support they need to succeed overseas.
Information and opportunities
Overseas Market Introduction Service (OMIS) – focused business advice and visit support from trade and investment teams in British embassies, Consulates and High Commissions overseas.
Export Marketing Research Scheme (EMRS) – provides companies with the facility to collect systematic and objective market research to assist in the development of a market entry strategy (managed by British Chambers of Commerce).
Business Opportunities – free internet-based service matching UK companies with international opportunities identified by trade and investment teams in our Posts overseas.
Aid-Funded Business – advice on business opportunities that are created through Multilateral Development Agency projects.
Private Sector Assistance
There is a wide variety of private sector advice available for companies wishing to do business in Turkey. This ranges from the business services provided by the big international legal and professional services firms to specific services provided by specialist operators.
The range of services available from the private sector includes company structuring, marketing, translation and interpreting, website design, partner selection, due diligence, legal services, advice on intellectual property rights and outsourcing. Some consultancies also offer more in-depth assistance on developing a Turkey strategy and operational management.
In addition, consultancies and universities with Asian Studies departments hold short workshops for business people on aspects of doing business in Turkey.
Lists of consultancies and legal companies who specialise in Turkey can be downloaded from: www.gov.uk/government/organisations/uk-trade-investment
Once you have decided that entering the Turkey market is right for your company, you will need to identify which part of Turkey you will start in – unless, of course, you are doing business in Turkey as a result of an initial enquiry from a Turkish company.
Choosing the right place to start will depend on a whole range of factors, many of which will be specific to your company.
The following 'Questions to ask yourself' may help to focus your thoughts on identifying the best place to start:
Questions to ask yourself
There are a range of investment zones in Turkey – all of which encourage foreign companies to do business in their particular zone. Are there any such zones in the areas of Turkey you are looking at and, if so, what incentives are on offer?
Principal Commercial Centres and Towns
Ankara: (Population: 4.5 million)
With a population of 4 million, Ankara is the capital of Turkey and seat of the Government and its 2nd largest city. Although traditionally a city of civil servants, politicians and Embassies it is increasingly becoming an industrial centre for eg defence, aerospace, security, ICT, medical, metallurgy, advanced engineering, renewable energy, agriculture and furniture. There are eleven organised industrial zones, with OSTIM being the largest in Turkey and 6 Technoparks.
It is also home to Turkey’s construction sector. Turkey’s contractors are 2nd only to China globally and their trade association - Turkish Contractors Association, http://turkishcontractors.com/.
Ankara is also home to the National Union of Chambers of Commerce of Turkey (TOBB) www.tobb.org.tr/Sayfalar/Eng/AnaSayfa.php .
Istanbul: (Population: 14 million)
The commercial centre of the Turkish Republic and former capital of three successive empires, Istanbul honours and preserves the legacy of its past while looking forward to its future. Istanbul owes its commercial importance to its favourable geographic location, acting as an intersection for sea and land trade routes. It is the financial centre of the country, and is also responsible for approximately 20% of Turkey's industrial workforce.
Izmir: (Population: 4 million)
Izmir, which is the major city of the Aegean region, plays an important role in the Turkish economy. A considerable amount of Turkish exports are shipped from the Port of Izmir, which is the second most highly utilised port in Turkey. The volume of trade activities in Izmir has improved with the establishment of the Aegean Free Zone several years ago, and the city promises to be one of the most progressive trade centres in the Middle East.
Izmir's main industrial sectors include agricultural products, foodstuffs, tourism, automotive, textiles, clothing, iron & steel and mining.
Konya: (Population: 1.3 million)
Konya is the largest city in south-central Anatolia and Turkey's agricultural capital. It is home to a large agroindustry. It is also known for its conservatism and as the home of the whirling dervishes.
Kayseri: (Population: 1.25 million)
Kayseri is an industrial town in the east of central Anatolia. It is one of the traditional centres of the weaving industry in Turkey. It has one of the largest organised industrial zones, with over 300 companies established on it. Kayseri is dominated by Mount Erciyes, a dormant volcano, on which the snow never melts. Mount Erciyes is home to a ski resort.
Gaziantep: (Population: 1.7 million)
Gaziantep is at the centre of the GAP (South-East Anatolian Project). The GAP is Turkey's most ambitious development project, comprising 22 dams and the irrigation of over 1.5 million hectares of land. Gaziantep has a strong industrial base.
There are three organised industrial zones and plans to establish a fourth, which would be a free trade zone.
Gaziantep is famous for its kebabs and baklava, reputedly the best in Turkey.
Eskisehir: (Population: 650,000)
Situated midway between Istanbul and Ankara, Eskisehir is a developing industrial town. There is a factory manufacturing aircraft engines. There are also two dynamic universities. Eskisehir is traditionally famous as the home of Meerschaum pipes.
Source - UKTI
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