Characteristics of the internationally active business economy
This chapter examines the characteristics of enterprises that are internationally active. To what extent are they exporters, importers or both? What proportion of them are independent SMEs or large enterprises and are they under Dutch or foreign control? Among internationally active entrepreneurs, what proportion are women and how does this figure vary by age category and sector? And how do internationally active enterprises differ as regards key indicators such as productivity, average wages, proportion of multinationals and proportion of exporters?
3.1Key findings
The international business economy is a highly diverse group of enterprises that differ in many respects. In the period under review, the largest share of exporters was in mining and quarrying, at 62 percent, with water and waste management second at 55 percent. Of the group of businesses in the Netherlands, 34 percent traded goods and/or services internationally. For independent SMEs, the share was 33 percent, while for large enterprises it was 88 percent. For both Dutch and foreign enterprises, most importers and two-way traders were active in the wholesale and retail sector, and most exporters were involved in professional and scientific activities.
The highest productivity among internationally active enterprises was achieved in mining and quarrying, followed by the energy sector. The highest average wages were earned by employees of enterprises that are internationally active in mining and quarrying, and in the energy sector. In 2018, the share of multinationals was largest in the mining and quarrying sector and smallest in repairs, accommodation and food services, and the construction sector.
Between 2015 and 2018, the share of internationally active enterprises that had been in existence for more than 10 years rose slightly. In contrast, the share of enterprises in existence for under 5 years saw a slight decline. More than a quarter of internationally active entrepreneurs are women, but there is hardly any difference between female and male entrepreneurs in the extent to which they are internationally active.
3.2Internationally active enterprises by type
The Dutch business economynoot1 comprised 1.2 million enterprises in 2018. This group can be divided into one-way importers, one-way exporters, two-way traders (enterprises that import and export), and enterprises that do not trade in goods or services and therefore do not trade internationally at all.noot2
Two-thirds of enterprises in Dutch business economy are non-traders
By far the largest group is that of non-traders. In 2018, 34.2 percent of enterprises were active traders. Of that group, 22.6 percent were importers, 7.9 percent were two-way traders and 3.7 percent were exporters (Figure 3.2.1). This composition is nearly unchanged compared to 2013.
| Jaar | Importers | Exporters | Two-way traders | Not trading internationally |
|---|---|---|---|---|
| 2013 | 21.2 | 3.3 | 8 | 67.4 |
| 2016 | 22.5 | 3.4 | 8.3 | 65.8 |
| 2017 | 22.6 | 3.8 | 7.9 | 65.7 |
| 2018 | 22.6 | 3.7 | 7.9 | 65.8 |
Wholesale and retail enterprises often internationally active
There are significant differences between the Dutch business sectors regarding the extent to which a company in the sector only imports, only exports, both imports and exports or does not trade (Figure 3.2.2). Of all sectors, wholesale and retail trade had the highest share of enterprises – 32 percent – that were only active in imports in 2018. The lowest share, at 15 percent, was in the construction sector. At 9 percent, the mining and quarrying sector had the largest share of enterprises of all sectors that were only exporters, while the accommodation and food services sector had the lowest share, at 1 percent. Two-way traders were most common in mining and quarrying, with a 23 percent share, and least common in accommodation and food services, at 1 percent. Companies in the real estate sector were least likely to be international traders (21 percent) and wholesale and retail enterprises were most likely (52 percent).
| Sector | Importers | Exporters | Two-way traders | Not trading internationally |
|---|---|---|---|---|
| Mining and quarrying | 0.080 | 0.045 | 0.120 | 0.275 |
| Manufacturing | 16.135 | 2.635 | 14.170 | 37.680 |
| Energy | 0.280 | 0.020 | 0.100 | 1.010 |
| Water and waste management | 0.340 | 0.070 | 0.360 | 1.280 |
| Construction | 28.105 | 2.420 | 3.780 | 153.350 |
| Wholesale and retail trade | 81.105 | 8.750 | 42.205 | 122.335 |
| Transportation and storage | 9.210 | 2.380 | 4.565 | 32.240 |
| Accommodation and food services | 17.745 | 0.355 | 0.495 | 44.175 |
| Information and communication | 28.035 | 6.290 | 9.495 | 57.590 |
| Real estate activities | 5.260 | 0.345 | 0.440 | 23.435 |
| Consultancy and research | 71.760 | 18.975 | 16.710 | 266.700 |
| Rental of movable property | 15.395 | 2.620 | 3.680 | 59.505 |
| Repairs | 2.990 | 0.150 | 0.490 | 6.395 |
88 percent of large enterprises internationally active
The internationally active business economy consists of independent SMEs and large enterprises that trade in goods and/or services internationally. Of the 1.2 million enterprises in the total Dutch business sector in 2018, nearly all – around 99 percent – were independent SMEs and just 18 thousand were large enterprises. These two groups differ in the extent to which they trade internationally and are two-way traders (Figure 3.2.3). In 2018, whereas two out of three independent SMEs did not trade internationally, this was only the case for one in eight of large enterprises. The opposite is true with regard to two-way traders. Only 7 percent of independent SMEs were two-way traders, compared to 64 percent of large enterprises. In contrast, the percentages of enterprises that were only active in exports or imports were similar for independent SMEs and large enterprises. Around 23 percent of independent SMEs only imported goods and/or services in 2018, compared to 20 percent of large enterprises. For both independent SMEs and large enterprises, around 4 percent were only active in exports.
| Grootteklasse | Importers | Exporters | Two-way traders | Not trading internationally |
|---|---|---|---|---|
| SMEs | 22.6 | 3.7 | 7.1 | 66.6 |
| Large enterprises | 20.2 | 4.1 | 64 | 11.8 |
Most importers and two-way traders are active in the wholesale and retail sector, while most exporters are involved in business services. This is true of both independent SMEs and large enterprises. In 2018, in the case of independent SMEs, 29 percent of importers were active in wholesale and retail trade, as were 44 percent of two-way traders. For large enterprises, 29 percent of importers and 40 percent of two-way traders were active in that sector. With regard to exporters, this share differed considerably between independent SMEs and large enterprises. In 2018, 42 percent of independent SMEs and 28 percent of large enterprises were active in exports of business services.
One in 100 enterprises are foreign-owned
In addition to the distinction between independent SMEs and large enterprises, the Dutch business economy can also be divided into foreign-owned and Dutch-owned enterprises (Figure 3.2.4). Of the 1.2 million enterprises in the Netherlands in 2018, some 14 thousand were under foreign control and the rest were Dutch. Around 1 percent of enterprises were therefore foreign-owned. In 2018, 64 percent of enterprises in foreign hands were two-way traders and 13 percent did not trade goods and services with other countries. Among Dutch enterprises, only 7 percent were two-way traders and 66 percent were not internationally active in trade. In relation to 2013, the number of foreign-owned enterprises has risen faster than the number of Dutch enterprises. From 2013 to 2018, the number of foreign-owned enterprises increased by 30 percent, while the number of Dutch enterprises rose by 20 percent.
| Zeggenschap | Importers | Exporters | Two-way traders | Not trading internationally |
|---|---|---|---|---|
| Foreign enterprises | 19.5 | 4.6 | 63.5 | 12.5 |
| Dutch enterprises | 22.6 | 3.7 | 7.2 | 66.5 |
For both Dutch and foreign-owned enterprises, most importers and two-way traders are active in the wholesale and retail sector, and most exporters are involved in business services. In 2018, in the case of Dutch enterprises, 29 percent of importers were active in wholesale and retail trade, as were 44 percent of two-way traders. The picture was similar for foreign-owned enterprises, as 35 percent of importers and 44 percent of two-way traders were active in that sector. For exporters, however, there was a difference between Dutch and foreign-owned enterprises. For the same year, 42 percent of Dutch enterprises and 27 percent of foreign-owned enterprises were active in exports of business services.
3.3Key indicators for internationally active enterprises
Table 3.3.1 shows that there are major differences between the sectors involved in international trade. The wholesale and retail sector has by far the most international entrepreneurs.noot3 Some 38 percent of internationally active entrepreneurs were working in this sector in 2018. At 36 percent, the largest share of multinationals was in mining and quarrying, but with 265 enterprises, this is only a small sector. In the wholesale and retail sector – the sector with the largest number of enterprises – the share of multinationals was only 6 percent. This share was less than 3 percent in repairs, accommodation and food services, and the construction sector – all three of which are almost completely focused on the domestic market. At 62 percent, the largest share of exporters was in mining and quarrying, and in water and waste management, this share was 55 percent. The highest productivity in internationally active enterprises was achieved in mining and quarrying, followed – a long way behind – by the energy sector. The highest average wages were earned by employees in mining and quarrying, and in the energy sector. In 2018, the average wage in the mining and quarrying sector was 38 euros per hour and in the energy sector the average hourly wage was 32 euros. The share of female entrepreneurs was highest in the accommodation and food services sector, at 35 percent.
3.3.1Key indicators for internationally active enterprises by sector, 2018
| Number of enterprises | Share of multinationals | Share of exporters | Productivity1) | Average wage2) | Number of international entrepreneurs | Share of female entrepreneurs | |
|---|---|---|---|---|---|---|---|
| Sector | % | % | % | ||||
| Mining and quarrying | 265 | 35.8 | 62.3 | 709 | 38 | 65 | 21.5 |
| Manufacturing | 33,105 | 10.4 | 50.8 | 103 | 25 | 18,295 | 21 |
| Energy | 425 | 23.5 | 28.2 | 265 | 32 | 105 | 12.4 |
| Water and waste management | 785 | 17.2 | 54.8 | 115 | 24 | 330 | 16.2 |
| Construction | 34,470 | 2.1 | 18 | 81 | 25 | 14,580 | 16.1 |
| Wholesale and retail trade | 132,675 | 6.0 | 38.4 | 64 | 21 | 76,015 | 29 |
| Transportation and storage | 16,285 | 9.1 | 42.6 | 82 | 23 | 12,180 | 21.5 |
| Accommodation and food services | 18,645 | 1.5 | 4.6 | 30 | 14 | 19,520 | 34.5 |
| Information and communication | 44,145 | 5.2 | 35.8 | 110 | 30 | 11,275 | 12 |
| Real estate | 6,350 | 6.3 | 12.4 | 184 | 28 | 3,500 | 21.3 |
| Consultancy and research | 108,390 | 3.2 | 32.9 | 73 | 31 | 32,300 | 21.9 |
| Leasing of movable tangible property | 21,920 | 5.5 | 28.7 | 34 | 17 | 9,965 | 24.8 |
| Repairs | 3,630 | 0.7 | 17.6 | 41 | 18 | 1,125 | 25.3 |
| Dutch business economy | 421,090 | 5.2 | 33.6 | 70 | 23 | 199,280 | 24.9 |
1)In 1,000 euros per year.
2)In euros per hour.
3.4Internationally active enterprises by age
Between 2013 and 2018, the proportion of internationally active enterprises that had been in existence for more than 10 years rose slightly, from 40 percent in 2013 to 44 percent in 2018 (Figure 3.4.1). In contrast, the share of enterprises in existence for under 5 years decreased by 1.6 percentage points.
| Jaar | Under 5 yrs | 5 to 9 yrs | 10 yrs and over |
|---|---|---|---|
| 2015 | 35.8 | 23.8 | 40.4 |
| 2016 | 35.6 | 23.2 | 41.2 |
| 2017 | 34.5 | 22.5 | 43 |
| 2018 | 34.2 | 21.5 | 44.3 |
In 2018, within the group of internationally active enterprises founded less than 5 years previously, most enterprises were active in mining and quarrying, energy, information and communication, consultancy, and research (Figure 3.4.2). Most internationally active enterprises that have been in existence for more than 10 years are in manufacturing, water and waste management, construction, wholesale and retail trade, transportation and storage, accommodation and food services, leasing of movable tangible property, and repair of consumer goods.
| Sector | Under 5 yrs | 5 to 9 yrs | 10 yrs and over |
|---|---|---|---|
| Mining and quarrying | 0.090 | 0.060 | 0.115 |
| Manufacturing | 8.585 | 5.460 | 19.060 |
| Energy | 0.230 | 0.095 | 0.100 |
| Water and waste management | 0.230 | 0.155 | 0.400 |
| Construction | 10.000 | 6.435 | 18.035 |
| Wholesale and retail trade | 42.405 | 24.755 | 65.520 |
| Transportation and storage | 4.605 | 2.935 | 8.745 |
| Accommodation and food services | 6.700 | 3.715 | 8.235 |
| Information and communication | 17.085 | 11.585 | 15.475 |
| Real estate activities | 2.280 | 1.265 | 2.805 |
| Consultancy and research | 42.555 | 28.410 | 37.425 |
| Rental of movable property | 8.380 | 4.940 | 8.605 |
| Repairs | 0.945 | 0.820 | 1.870 |
3.5Born globals
The change in the age distribution of enterprises is not only due to the fact that enterprises that continue to trade internationally become older, but also because a proportion of them start or stop trading. Moreover, there is a large group of enterprises that traded in a particular period, but changed their trading status over time, either from exporter (importer) to non-exporter (non-importer) or vice versa. In addition, there is a significant group of enterprises that, after taking this step, stops trading internationally again within a few years. However, the majority of this group do continue to exist as enterprises. There is also a large group of enterprises that repeatedly start and stop exporting, known as ‘intermittent exporters’. Although this group of ‘intermittent exporters’ represents over 20 percent of exporters, it is responsible for less than 2.5 percent of total export value (CBS, 2019).
| Sector | Born globals |
|---|---|
| Manufacturing | 445 |
| Construction | 290 |
| Wholesale and retail trade | 2155 |
| Transportation and storage | 295 |
| Information and communication | 965 |
| Consultancy and research | 2625 |
| Rental of movable property | 325 |
| Other sectors | 150 |
Within the group of exporters of goods and/or services in 2018, most starters and stoppers were active in consultancy and research, and in the wholesale and retail sector. These sectors also contain the largest number of born globals (Figure 3.5.1), which are enterprises that make a large part of their sales abroad very soon after being founded (CBS, 2019). However, there are also a relatively large number of born globals in the information and communication, manufacturing, and construction sectors. This is in line with the findings of a European Union study (Eurofound, 2012), which states that in Europe, born globals are relatively common in the wholesale and retail trade, business services, manufacturing, and the information and communication sector. Around 24 percent of start-up exporters of goods and/or services were born globals in 2018. In 2018, the export value of born globals was about 0.4 percent of total exports of goods and 0.4 percent of total exports of services (CBS, 2019).
3.6Internationally active entrepreneurs by gender
Women make up a quarter of the group of entrepreneurs who trade internationally or are at the helm of a multinational.noot4 In 2018, for example, there were a total of 49 thousand internationally active female entrepreneurs in the Dutch business economy, against 142 thousand male entrepreneurs. Although the number of male entrepreneurs is considerably larger than the number of female entrepreneurs, there is nearly no difference in the extent to which they are active internationally. In 2018, for example, 14.5 percent of female entrepreneurs were internationally active, compared to 15.2 percent of male entrepreneurs (Figure 3.6.1).
| Geslacht | 2016 | 2017 | 2018 |
|---|---|---|---|
| Male internationally active entrepreneurs | 15.8 | 15.5 | 15.2 |
| Female internationally active entrepreneurs | 15.3 | 14.7 | 14.5 |
The degree to which entrepreneurs are active internationally is connected with their age (Figure 3.6.2). The proportion of male entrepreneurs who are internationally active increases up to and including the age category 45–54 years and then declines. For female entrepreneurs, the proportion who are internationally active increases with age and does not decrease from the age of 55. In the group of entrepreneurs aged 25 to 55, women are slightly less internationally active than their male counterparts. Socioeconomic factors such as childcare probably play a role here, as it is precisely in this age group that many women are mothers and work less. It is generally women who take on the childcare responsibilities and it is more difficult for them than for men to achieve a work-life balance (Weerden & Martens, 2018).
| Leeftijdscategorie | Male internationallyactive entrepreneurs | Female internationally active entrepreneurs |
|---|---|---|
| 15 to 24 yrs | 6.0 | 6.4 |
| 25 to 34 yrs | 11.4 | 10.0 |
| 35 to 44 yrs | 15.3 | 13.6 |
| 45 to 54 yrs | 18.1 | 16.6 |
| 55 to 64 yrs | 17.1 | 17.0 |
| 65 yrs and over | 15.1 | 17.7 |
The extent to which male and female entrepreneurs are internationally active also differs between the sectors (Figure 3.6.3). In mining and quarrying, water and waste management, construction, and transportation and storage, female entrepreneurs are considerably more internationally active than male entrepreneurs. Female entrepreneurs were the least internationally active in the real estate sector in 2018 (5 percent).
| Sector | Male internationallyactive entrepreneurs | Female internationally active entrepreneurs |
|---|---|---|
| Mining and quarrying | 25.0 | 33.3 |
| Manufacturing | 26.9 | 23.1 |
| Energy | 12.9 | 10.5 |
| Water and waste management | 17.1 | 30.8 |
| Construction | 6.2 | 16.3 |
| Wholesale and retail trade | 33.4 | 29.5 |
| Transportation and storage | 15.5 | 25.5 |
| Accommodation and food services | 8.4 | 6.5 |
| Information and communication | 12.9 | 11.3 |
| Real estate activities | 7.1 | 5.1 |
| Consultancy and research | 9.2 | 6.2 |
| Rental of movable property | 9.7 | 6.8 |
| Repairs | 12.2 | 11.9 |
3.7References
References
CBS (2019). Internationaliseringsmonitor, tweede kwartaal: Patronen in handelsgedrag. Statistics Netherlands: The Hague/Heerlen/Bonaire.
Eurofound (2012). Born global: The potential of job creation in new international businesses. Luxembourg: Publications Office of the European Union.
Weerden, L. van &. J. Martens (2018). De positie van de vrouwelijke internationale ondernemer: Een literatuurstudie naar behoeften, motieven en belemmeringen. Netherlands Enterprise Agency. Consulted on 29 June 2020.
Noten
Companies considered part of the Dutch business economy are those listed in the General Business Register, sections B to N plus division S95, with the exception of those in section K. Agriculture, forestry and fisheries (A), financial institutions (K), public administration (O), education (P), health care (Q), culture, sports and recreation (R), ideological and political organisations (division 94), wellness and funeral services (division 96), households (T) and extraterritorial organisations and bodies (U) are therefore outside the Dutch business economy.
In defining the types of traders, no minimum threshold was used to filter out small traders. Importers (exporters) trade in goods and/or services; a two-way trader is active in both importing and exporting goods and/or services.
Entrepreneurs are people carrying out work on their own account or at their own risk in their own business or practice, or are owners of a company and employed by the company as director
In defining the types of international entrepreneurs, a minimum threshold of 5 thousand euros was used to filter out small international entrepreneurs.