Starting a Business in Sweden
Sweden Business Experts
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Why Start a Business in Sweden?
Sweden is one of those few ethic stews bubbling with culture and heterogeny. They are musically heard, literarily read, cinematically seen and economically involved. It's all ABBA, Strindberg, Bergman and booming. Why wouldn't you want to go. Sweden's topography and people are quintessentially Nordic, which means they are chiselled, stunning and curvy, with blue skies and bluer eyes. Their business culture is just as attractive.
For its size, Sweden is one of the world's biggest beneficiaries of foreign investment, with robust international relationships, a skilled workforce, low corporate tax rates and a near absence of bureaucracy. And no-one wants to be tripping up on red tape. On top of this, the UK has a flawless reputation there and has enjoyed centuries of trade that has shifted over the years from raw materials to high tech goods and services. Anglophonic and anglophile are the adjectives that completely encapsulate the Swedish attitude toward us.
Sweden maintains a very competitive position in the global economy. Its economy thrives on innovative investment, new technologies and competence. Indeed, there are few other countries with as many multinational businesses as Sweden. There you will find a well-oiled and adjusted society, characterised by solid economic fundaments, sturdy political institutions, a well-educated, motivated workforce and leading technologies.
For its size, Sweden is one of the world's biggest beneficiaries of foreign investment. Robust international relationships, a skilled workforce, low corporate tax rates and a near absence of bureaucracy are just some of the many advantages that make it an attractive choice for entrepreneurs. Sweden's contemporary transport network and geographical location underpin its position as a natural hub for the North European and Baltic markets.
Swedish business is eclectic. It encompasses world-class multinationals, robust middleweight companies over a range of sectors and a thriving small business community. The corporate environment is highly internationalised, mirroring the country's strong tradition in export-oriented industry. Swedes are technically sound, scientifically curious and have much propensity for innovation. Not only do they have avidity for developing new technology, but are also quick to utilise the latest, most efficient products.
Foreign businesspeople choose Sweden for many reasons. To many, the country is an unexploited market with strong sales potential. Purchasing power per capita is higher than both Germany and France. The market is easily the largest in Scandinavia and is an essential constituent of the European Union marketplace.
However, despite these overwhelming benefits, Sweden can be a tough market for UK companies to penetrate. Competition is naturally fierce, products need to be innovative and contemporary and after-sales service should be integral to your package.
What is the population?
The population of Sweden is a relatively tiny 9.6 million.
What is the currency and exchange rate?
Sweden uses the Kronor (SEK).
What is the climate like?
Sweden has a moderate climate, with mild temperatures in both winter and summer. In winter, temperatures range from about -7C to 2C and average temperatures in summer range between 20C and 25C, though occasionally higher. Snowfall usually occurs from January to March. Rainfall isn't rare throughout the year, and July and August tend to be the wettest months.
What is the time difference?
The time in Sweden is GMT + 1.
What languages are spoken?
The official language of Sweden is Swedish, which is very similar to the other Scandinavian languages: Danish, Norwegian and Icelandic.
English is taught as a compulsory secondary language in Sweden, and is widely known by citizens and is in active use in the business sector.
The economy of Sweden is dependent on a highly developed and internationally successful industrial sector, established in the early part of the 20th century through companies such as Ericsson, Asea, Astra-Zeneca, Alfa Laval, SKF, Electrolux, Volvo and SAAB, and now includes more recently established companies such as H&M and IKEA. However, many of the flagship companies are now totally or partially owned by foreign companies and shareholders. There have been several structural reforms since Sweden became a member of the EU such as the deregulation of the telecommunications, energy and air traffic sectors.
Due to rapidly rising discretionary income, increasing employment and a steely wealth position, spending is forecast to improve considerably. Strong finances in the local government sector are accelerating growth in the sector's consumption.
The need for labour is good, and the number of newly reported vacancies is high with companies planning to employ more people. Consequently, employment is expected to continue rising.
Labour and workforce
Sweden has a well-educated workforce of approximately 4 million. Skills in such areas as information technology are high. Unemployment has been falling and is nearing the government's target of 4%. The labour market is highly regulated, including laws overseeing employment security, the work environment and employee involvement in making decisions.
Sweden has the greatest percentage of population, after the US and Canada, to have continued on to higher studies after secondary school. Recent OECD figures show that 27% of Swedes have college, university or other education. The Swedish workers' top level of qualification and skills is the factor most often talked about by foreign firms when questioned about the benefits of Sweden's corporate environment.
The country is a favoured location for operations needing skilled labour, such as advanced production, high technology, research and development, and for corporations requiring experience from international management. Only Japan has more research and development personnel per capita than Sweden. Foreign-owned companies can benefit from the availability of well qualified workers familiar with innovation, creative teams often working intimately with academia and institutes on research and development ideas.
There is no minimum wage regulation by Swedish law. This is because wage issues are the responsibility of the parties in the labour market, generally the trade unions and employers' organisations. According to accepted procedure, the parties of the labour market have set the minimum monthly wage at SEK 14,500 (£1,200) for full-time workers.
The average monthly wage in Sweden amount to SEK 26,500 (£2,200) for men and SEK 22,100 (£1,800) for women.
By law, the basic work week is 40 hours. Overtime is limited to 48 hours over a four week period and no more than 200 hours per year.
Egalitarianism is the most obvious social value in Sweden. Consensus and compromise are essential in business and social lifestyles. When doing business in Sweden, you will instantly notice the lack of obvious hierarchy and status that is apparent elsewhere in the business world.
Meeting & greeting - A handshake is done swiftly and firmly. Between men and women it is a lot lighter. Men should wait until a woman extends her hand first. If wearing gloves, remove them before shaking hands.
Swedes like to establish relationships on an informal level. However, private and business lives are very much segregated so this informality does not equal intimacy. When doing business in Sweden, expect to address a person by their first name.
Swedes often stay further apart when talking than many other countries. Personal space is private, so with the exception of the handshake, avoid touching. Do not backslap or embrace. Avoid speaking with your hands in your pockets as this is considered bad etiquette.
Swedish communication style is direct and open. This can translate as abrupt, but is not so. When conversing, be sure to listen attentively to anyone speaking and not to interrupt. Turns are taken to offer opinions.
Before doing business in Sweden, know that Swedes respect knowledge and experience. They are attentive to detail. Any proposal or presentation must be meticulously planned and logically organised.
Negotiations - Do not be overly emotive during negotiations. Always remain collected and controlled. The Swedes value unanimity as the only way of making decisions.
Dress - When doing business in Sweden, think conservative. For business, men should wear good-quality suits with silk ties and shirts. Women should wear suits or business dresses that are stylish yet understated. Trousers are acceptable for business women in Sweden.
The egalitarian values of Sweden mean you should remember to keep a low profile. Avoid wearing anything flashy. Even executives do not overdress any more than average employees.
Meetings and negotiations - Make appointments at least two weeks in advance.
Punctuality is important when doing business and also for social engagements. Never be late. If you must be late for any reason it is absolutely crucial to phone and let someone know. Being late is seen as poor etiquette and will reflect badly on you.
Organisations that can assist with Starting a Business
GTP cross cultural trainings and intercultural workshops help global companies in improving their communication, efficiency and profitability when doing business across cultures.
Simplified Global Payroll Managing payroll in multiple countries is complicated with different systems, deadlines, and languages in each country, lack of reporting, and constantly changing laws and regulations. Trying to manage global payroll via fax and email with excel spreadsheets leads to data security issues, fines, and penalties for non-compliance. Blue Marble has solved global payroll challenges with cloud-based technology, customized aggregated monthly reporting, and a hybrid service model in 150+ countries around the world.
PEO Worldwide is an international PEO offering employer of record, payroll, employee benefits management, HR and compliance services throughout the world.