Dr Francesco Frattini established the consultancy company to help Italian entrepreneurs do successful business in Bulgaria
For more than 15 years now, Italian investors who consider opening a business in Bulgaria and ultimately decide to make the jump, have had a trusted friend and partner by their side. Alias Group is a consultancy dedicated to translating the Bulgarian mentality, business ethics, bureaucracy and much more to Italian entrepreneurs and companies. Alias Group's portfolio of services is as wide as it is needed: from setting a company to legal help to accounting and staff selection.
At the core of this effective team is Dr Francesco Frattini, founder of Alias Group.
Why do Italian companies decide to invest in Bulgaria?
I need to clarify something. In the past 2 years the situation in Bulgaria changed. Before this Italian companies were mainly attracted by the country's low corporate tax, which is 10%. Recently, things have made a turn for the worse. The low corporate tax is still here, but Bulgaria's banking system has changed. Nowadays banks do an in-depth analysis of the business type and sector of foreign companies that want to open accounts in them. Two years ago Italian entrepreneurs would settle in Bulgaria with the idea to produce here and export goods and services to Europe. Now they are required to do business targeted to the Bulgarian market. This significantly reduced their interest in the country. What we see now are entrepreneurs in locally based activities such as opening of restaurants, bars, stores.
And then, of course, came the problems caused by the Covid-19 pandemic.
What are the most common problems Italian businesses encounter in Bulgaria?
Until two years ago the main difficulty was the difference in culture, tradition, work ethics, and the language barrier. Alias Group's main role was one of a culture intermediary between the Italian entrepreneur and the Bulgarian market.
These differences are still here and will remain here. Entrepreneurs still need Alias Group's help to navigate the Bulgarian market, bureaucracy and mindset. Only prepared businesses can be successful here. When they arrive in Bulgaria with the attitude that they will operate just like in Italy, they are bound to experience a lot of troubles.
But then we had the difficulties with the banks. All banks in Bulgaria significantly reduced their readiness to open accounts and to work with foreign companies, not just Italian ones. Today it is practically impossible for a foreign investor to arrive in Bulgaria and to establish a company without the help of a consultancy like Alias Group.
The situation is so serious that I wrote a complaint to the Bulgarian National Bank and the Association of Banks in Bulgaria. I am expecting an answer and a positive change.
How does Alias Group help clients to overcome these challenges?
The professionals at Alias Group are fluent in Bulgarian language, cultural traditions and differences. We can help in sensitive situations and we provide not only language, but also cultural support. Knowing the cultural context and the Bulgarian mindset is crucial for having a successful business here.
The second level of support that Alias Group offers is dealing with Bulgarian institutions. For more than 15 years we have built a wide network of connections and contacts that allow us to deal with any problem a business might encounter.
Our expertise is crucial since the moment a business arrives and a company is set and applies for licenses and approvals from the institutions. We are of use, too, at a later stage when problems or arguments with Bulgarian partners appear. In such cases we help our clients and their partners find a common ground and solve the problem in a mutually beneficial way.
And again, the banks. After that difficult year we found a way to present our clients in the right way to the right people, and to help them open accounts.
What are the most popular services of Alias Group?
First: collecting and presenting information about Bulgaria. Unfortunately, Bulgaria suffers from insufficient marketing abroad. In my experience, it is either completely unknown or is known for the wrong reasons. A lot of people are not aware that it is an EU member and many think that its corruption and organised crime levels make it impossible to have a successful business.
For more than 15 years I have explained that Bulgaria has a good business climate and that the crime levels are lower than in many other countries.
When the potential investor is reassured, we start talking on how to establish the business in the best possible way.
Investors are very interested in important questions about taxes and tax incentives, the cost of workforce, loans, industrial property and energy.
I always explain that they should not seek in Bulgaria a potential internal market, as with its less than 7 million people it is a small market with low purchase power. Bulgaria's potential is as a hub that exports to other European countries. Visionary entrepreneurs can also benefit from its proximity to the large and prospective markets in Turkey and the Middle East.
Are there major differences between Bulgarian and Italian business ethics?
I think that the Italians are the foreigners who feel most at home in Bulgaria. It is mainly because of our shared talent to find a shortcut when a problem arises. Moreover, Italy's bureaucracy is so complicated and big, that we are not that impressed by the intricacies of the Bulgarian one.
What an Italian investor should be aware of when starting a business in Bulgaria?
The most common mistake I see foreign entrepreneurs make in Bulgaria, particularly successful ones, is being arrogant. They believe that if they have made it in Italy, they will make it here as well. All these people failed. The ones who really succeeded in Bulgaria were humble and sought to understand how things in Bulgaria work.
Here, one needs to be patient in order to succeed. This is the result of the 500-year Ottoman domination and the Communist regime, and is still present. Deadlines are protracted and things move slowly, but when you are aware of this, you can achieve your goal. The result is what matters, not the speed.
With this understanding and with our help, a business can thrive in Bulgaria. I am proud to say that in the past 15 years Alias Group has consulted dozens of companies. Only 2 failed and ceased operation here. I am sorry for them, but their example only confirms that I was right all along on how one can succeed in Bulgaria.
Sofia, 14 Georgi Benkovski St
phones: +359 2 983 20 71, +359 2 983 35 96