In 2019, the Business Promotion & Development Campus (BPDC) was established in Washington DC. BPDC was set up to provide Hungarian companies with a wide range of training programs with the aim of facilitating the entry of Hungarian companies into North America. Why is the entry of Hungarian companies into the U.S. market important?
The U.S. is an exciting destination for many companies looking to expand internationally. It is a difficult market to succeed in, but companies that have a good product, business model and management should have little to no problems finding their place. The successful expansion of our Hungarian companies usually results in new investments and workplaces created in both countries over time. We believe that helping Hungarian companies enter the U.S. market is a win-win for both sides. Getting into the market is one thing, but we also would like to make sure that companies stay and succeed in the market as well. A good, strong start is very important to achieve both of these goals.
This is the exact reason why the Hungarian Ministry of Foreign Affairs and Trade, as well as the Ministry of Innovation and Technology, has supported the idea of the Business Promotion & Development Campus and why the current Ambassador to the U.S., Szabolcs Takács, supports the project’s continuation as well. It has been a pleasure working with Ambassador Takács throughout the last couple of months, and I am encouraged by his efforts of continuing to support Hungarian businesses in their international endeavors.
How many Hungarian companies are present in the U.S. and what are the major issues/difficulties with entering the U.S. market and/or setting up a business in the U.S.?
It is difficult to say exactly how many Hungarian companies operate in the United States, but the number is increasing. According to the U.S. Bureau of Economic Analysis, Hungary’s “Foreign Direct Investment Position” in 2019 was over USD 52 billion*, a 65 percent increase over 2018’s figure, which itself increased 44 percent over 2017. We don’t know yet how the pandemic has affected these numbers for 2020, but we expect to see continued growth in the long run.
There are many challenges that Hungarian companies have to deal with when trying to enter the U.S. market, ranging from the difference between economic environments to the high prices compared to Hungary. Companies trying to enter need to be aware that the United States is not a monolith. Every region and state of the U.S. is different, with different rules and legislation, which is why it is important to research the markets before doing anything else.
What kind of help/support do companies looking to enter the U.S. market get from the Business Promotion & Development Campus?
We offer a range of support to Hungarian companies, depending on their needs. A couple of times each year, we offer comprehensive programs in cooperation with American experts, who mentor Hungarian company representatives about topics such as legal and taxation issues, marketing, fundraising and other intricacies of doing business in the U.S.
Besides these programs, we are able to help companies by providing affordable lodging and a place to do business, as well as connections to experts and sometimes even potential partners or potential investors. I think it is also important to note that the campus of BPDC is located right next to the Embassy of Hungary, so the colleagues from the Embassy’s Trade section are always happy to be of help and are always within arm’s reach.
Are there any requirements regarding the types of companies that can use the support of the Campus/program?
We do our best to assist every Hungarian company that comes to us. There aren’t really any restrictions in terms of what type of companies can use our Campus, though most of our organized programs are designed for small or medium innovative companies with an established presence in the Hungarian market. These are the companies that usually have the funds to be able to explore the United States as an option but are small enough to find the resources and networks that we offer them to be very useful.
How is the success of the center measured and what results should companies expect to achieve with this support?
We rely on honest feedback from our Hungarian companies as well as our American partners. The Hungarian companies always provide us with information regarding what they found useful in our programs and what they would have liked to learn more about, while our U.S. partners tell us what they liked about the companies they worked with and what they think their strengths and weaknesses were. Using information from both sides, we are able to organize increasingly effective programs over time. Many companies have told us that they were surprised at how much they learned over the course of a program, and we have been very encouraged to hear that.
Participants of our BPDC programs should expect to learn about all of the important aspects of doing business in the United States, while being provided with a place to stay and do business if they decide to physically go overseas for the duration of the program. They will also receive our assistance in building an initial network of helpful contacts in the U.S. However, these companies are responsible for their own success, and we simply provide tools that can help them establish themselves overseas.
Are there already examples or best practices for future companies to share with companies that would like to join the program?
The markets in the United States are very competitive, and companies need to be aware that the United States is not a monolith. Companies should research the different regions and states within the United States and have a clear plan on which region, segment and consumer group they want to target. Companies also need to be ready to present a clear “Value Proposition” and be ready to explain to an American audience what sets their product or service apart from the rest. There are so many companies around the world that want to enter the United States, so it is very important to be able to passionately market and sell your idea to potential American partners.
Trying to enter the United States as a foreign business can be quite challenging, but it is not impossible. Interested Hungarian companies should know that our colleagues at Hungary’s Washington DC Embassy are always there for them, the Business Promotion & Development Campus is available for expert support, and the Ministry of Foreign Affairs and Trade here in Budapest is also here to help in any possible way.
*Data is from the U.S. Bureau of Economic Analysis