A British company of 6 people producing hand-made designer jewellery becomes famous after a celebrity wears one of its pieces at a gala dinner. Now that its products are popular, the company receives enquiries from all over Europe. In order to be able to distribute its products across Europe, it decides to set up an online shop which would be accessible by the whole of the EU. It believes the easiest way to do this would be to adapt its internet platform by translating its content into other languages. To make sure that this would be sufficient, the company contacts a lawyer and a software developer. The lawyer advises to hire an expert in contract law from each relevant country as it would be necessary to check the relevant national laws (both consumer and contract) and draft an amended set of country specific terms and conditions. This exercise could cost around €8,850 per country (5 days work billed at €295 per hour). The cost for entering the market for all the other 26 Member States would therefore be €230,100.
The software developer explains that the current internet platform would need to be adapted to reflect the legal requirements for each country they sell to. The website would need to determine the consumer's country of residence, locate and retrieve the correct set of pages and display them in a correct language. This work would take between 2-6 weeks. The software developer would charge around €1,550 per week. The cost per country would be at least €3,100 and upon entering the other 26 Member States this would rise to €80,600.
The transaction costs for offering products in the whole of the EU would be about €310,000, this would be 50% more than the company's complete turnover of the previous year. Upon seeing the amounts, the company decides that the maximum it can afford would be €25,000 – the approximate costs of entering two additional Member States. It decides to offer products only in the larger markets of Germany and France instead of selling it to all the other countries.
Yo diría que este empresario británico es imbécil.