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Are you considering establishing your business in France? Perhaps you’ve identified several opportunities in the French market, but you’re still hesitating whether it’s the right move for your company.
If so, you might have heard some clichés about doing business in France – that starting a business takes a long time, that employees take too many holidays, and that social security contributions for employers are sky high.
These are important questions to consider before deciding to set up shop in a country. That’s why we’ve taken five clichés about doing business in France and asked: is there any truth to them today?
Myth #1: Starting a business is slow and complicated
Contrary to what you might have heard about France being a country of excessive administrative hurdles, setting up a business actually only takes 3.5 days – compared to 4.5 in the UK and 10.5 in Germany.
What’s more, all the legal formalities involved in setting up a company can be conducted on the government’s web portal, called Guichet Entreprise. When it comes to signing the legal statutes, however, this must be done in person, which is why it can be useful to entrust an intermediary to sign your company into law officially.
We offer free guidance for foreign companies looking to set up shop in France.
Myth #2: Accessing to funding is limited
Historically, private investment and fundraising opportunities have been quite limited in France compared to other similar-sized countries. As a result, for a long time, there were hardly any French unicorns (companies valued at $1 billion).
Yet, in the last decade or so, this has drastically changed. From Backmarket, to Qonto, to Doctolib, the list of French unicorns gets longer each year. That’s because there’s much more private funding in France now than ever before.
Last year, start-ups in France raised €11.6 billion ($12.4 billion) in investments, up 115% year-on-year. In fact, investment in French projects is growing at a much faster rate in France (24%) than in the United Kingdom (2%), for instance.
Want to know which public grants and private investments your company is eligible for if you decide to settle in France?
Myth #3: The French are allergic to hard work
Did you know that, besides being entitled to 25 days of paid leave per year, French workers also enjoy up to 11 days of public holidays, depending on the region?
This has led some to question the French work ethic. Unjustly, it turns out: France’s workers put in 100 hours more a year than their German counterparts, according to the OECD’s ranking of countries by actual hours worked.
So while holidays are definitely an important part of French culture, this doesn’t appear to hamper productivity. On the contrary, French workers are among the most productive in all of Europe, with the average GDP per hour worked in France at $68, compared to $66.4 in Germany and $58.4 in the UK.
Combined with recent data suggesting that more time off actually encourages people to work harder, France appears to have figured out the right balance between work and leisure. Unsurprisingly, many major companies have decided to relocate to France in recent years due to the quality of life it offers.
Interested in finding out more about talent recruitment in France?
Myth #4: The French don’t speak English
While English is definitely less prevalent in France than in Nordic countries, the country has been steadily climbing up the ranks in recent years.
According to the 2022 English Proficiency Index, France actually performs quite well. Out of the four largest eurozone economies – Italy, France, Germany, Spain – only Germany is ahead of France in terms of English-language proficiency.
Considering current political, economic and social trends, it is highly likely that France will continue to embrace English as it continues to strengthen its position in globalized world.
Businesses looking to settle in France in 2023 should therefore not be discouraged by any preconceived notions about language barriers.
Interested in finding the right talent or business partners who are proficient in english?
Myth #5: It’s too difficult to hire and fire employees
Since Macron’s 2017 labor law reforms, it has become easier for businesses to hire and fire employees. Companies now enjoy a 2 to 8 month trial period for new hires, during which employers can terminate the contract at any given moment.
There is also greater flexibility when it comes to negotiating wages and conditions directly with employees, rather than having to deal with collective deals negotiated by trade unions.
As a result of these reforms, Employment-related disputes have been cut in half, and France now has its lowest unemployment rate since 2008 (7.6% in late 2021).
All in all, France has therefore embraced a new direction with a wide range of pro-business policies that favor innovation and more flexibility, so hiring and firing employees is now easier than it’s ever been.
Interested in finding out more about talent recruitment in France?
The Impact Program: quick access to business partners and talent
There is no doubt that France has a lot to offer foreign businesses – from a highly productive workforce, to easy access to funding and business-friendly policies.
To help you establish your business in France, we have created the Impact Program which provides you with quick access to business partners and talent. This tried and tested program has helped many companies tap into the French and European market (check out our testimonials page here).
With the Impact Program, we provide continued long-term guidance and support in the following areas:
- Matchmaking with partners from our business ecosystem
- Overcoming linguistic, administrative and cultural barriers
- Establishing your subsidiary (legal support, accounting, etc.)
- Finding and renting suitable premises
- Obtaining regional financial support
- Recruiting top local talent
- Expanding to international markets
Discover what our free impact program can do for you !
