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Conquering Foreign Lands
Bob Williams, of Vengroff, Williams & Associates, pushes the Sarasota collections and receivables company into the European market. Next up is Central and Latin America.
By Sean Roth
Real Estate Editor
If you bump into Bob Williams, please be sure to point out the nearest Laundromat. Of course if you are running into the CEO of Vengroff, Williams & Associates, a Sarasota-based commercial collections and receivables management firm, you are probably visiting one of the seven cites in Europe that will serve as the company's new international wing. For the past year, Williams has traded in the Sarasota office and his Myakka Ranch home for life as an expatriate to solidify the company's entry into the European marketplace.
Williams has a hefty task. The expansion is a result of a deal with one of the company's largest clients: the Walt Disney Co.'s DVD and video operations. The European expansion is not simply a move to seize market share in the international market, but it is a contracted, timed exercise as part of its deal with Disney.
The company landed the Disney contract about six months ago, and was given 16 months to set up operations in Europe.
"This is a pretty pivotal year now," Williams says. "I'm here to make sure the business gets into high gear."
With its European headquarters in Amsterdam, Netherlands, the company is establishing offices in Venray, Netherlands; Dublin, Ireland; London; Milan, Italy; Paris; and Madrid, Spain. Williams expects to employ about 100 people in the European market.
"We chose Amsterdam, because Cisco (Systems Inc.) was already there, and they are a client of ours," Williams says. "We are really trying to beef up our sales staff in Europe. We have a new director of sales and marketing for Europe, Cees Jansen. We hired him away from a competitor. Two others are working with us on a freelance basis."
Next year, Williams plans to take VWA into Central and Latin America.
"We are looking at Mexico City; Rio De Janeiro, (Brazil;) and Buenos Aires, (Argentina)," Williams says. "We already have an account with Buena Vista (International Ltd.) Essentially, we brought our successful business model from the U.S. to Europe and massaged it. But (Latin and Central America) are very different markets, because of where they are positioned. We will definitely have to hire senior people there."
The European expansion is already starting to pay dividends, but VWA officials aren't surprised. "Usually before we go into a new marketplace," says Williams, "we already have a large client there. That way, although there is some initial out of pocket costs; the new offices are generally profitable from the beginning. We usually are back in the black within four to five months."
The extra Disney and European exposure has also led to even more high-profile clients. VWA picked up contracts with Fox Communications and Warner Bros. Entertainment's video division. "We now have the top three in that market space (video/DVD entertainment)," Williams says. "They have about 80% of the market."
The European offices also allowed VWA to take an unexpected gain from the euro to dollar exchange. "When we set up the offices we put about $2 million in euros," Williams says. "Back then the euro was trading at $1.08 to the dollar. When we took it out (the euro) was $1.20 (to the dollar). I figure on the currency exchange alone we made $100,000. It was just a matter of timing. We will probably use that money in Latin America."
To get around the language, legal and cultural differences, VWA and Williams tried to hire the best employees away from competitors in each local market. Most of the new staff is bilingual, though, Williams makes a point of having all the management meetings in English.
"We have hired some very talented people," Williams says. "Those few people who don't speak the language well, we are sending to school. We reinforce to them that they are working for an American company, and they need to understand English. I have told them I will learn French and Dutch within a year. (Right now) I just speak a little bit of Spanish. I hear there are specialized schools held in a monastery where you are totally immersed in the language. I'll probably do that."
VWA is also looking at other companies to outsource some of its operations in the European market.
For Williams, the process appears to be going smoothly; not bad for an executive suddenly thrust into the business climate of a foreign continent for an extended period. "I had worked in Europe before but that was 27 years ago." he says.
These days, Williams changes cities every two to three weeks.
"Really, I get through it by working 11 to 12 hours a day. I don't have much time outside of the office. A lot of the (business) culture is the same. The biggest logistic is getting my laundry done. It's things like that that you take for granted in the U.S. I'm also not sure where anything is. I try to stay at the same hotel in each city so I have some idea. There are also still cultural differences you have to deal with. In Paris there were two 90- and 95-degree days recently. My hotel had no air-conditioning. You just learn to deal with it."
What advice would Williams offer other business owners looking to make an international expansion?
"Don't come in naive," he says. "Make sure you study the market before you make the jump. You need to know what you are doing. We have had to learn by making mistakes, because we were being pushed by the Disney contract. If I had it to do over; I would have spent two to four months learning about how business is being done in Europe. Unfortunately, we had 16 months and no infrastructure in place."
Williams says VWA's European offices should be stabilized by year's end. After Central and Latin America, Williams says he may have to pack for the Far East. "We might do a bigger facility in Singapore," he says. "We already have a five-person office there. We are also looking at Australia ... overall the Asia pack. I think to start up we would put three offices there, about 25 people to start."
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