FRANCE, GERMANY, ITALY & SPAIN: ‘‘The profile and behaviour of SME’s which use the Internet for international purpos

1. FRANCE, GERMANY, ITALY & SPAIN: ‘‘The profile and behaviour of SME’s which use the Internet for international purposes’’ Online study carried out between 20 November 2007 and 5 February 2008 with 3 438 companies which are active abroad. Questionnaire for visitors to the Europages.com website and companies present in the EUROPAGES database, including over 900 000 European SME/SMI’s.

2. Contents • Foreword Page 3 • The EUROPAGES Observatory Page 4 • Survey method: Page 5 • Observation criteria Page 6 • Significativity test Page 7 • Profile of participants Page 8 • I. Import trends Pages 9 - 15 • II. Export trends Pages 16 - 26 • III. Other lessons Pages 27 -32 • Recap Pages 34 - 36 • Appendices Pages 38 - 53

3. Foreword In France and across Europe, there is an increasing awareness of the importance of the international development of SME’s for the economy. In this context, the aim of the EUROPAGES Observatory was to provide a credible answer to one of the key questions asked today by all those involved in international trade: what is the role of the Internet? More specifically, are SME’s which use the Internet as part of their international strategy more successful than ‘‘other SME’s’’? Are their profiles, their behaviour and their results significantly different? With this objective, the present study carried out on the request of the EUROPAGES Observatory consisted of describing the profiles of companies which use the Internet as part of their approach to foreign markets and what this use involves in 4 of Europe’s largest countries in terms of international exchanges: Germany, Spain, France and Italy.

4. The EUROPAGES Observatory For 25 years EUROPAGES has been the daily partner of European companies wishing to develop internationally. In order to make it more efficient and bring it closer to SME’s, in 2002 EUROPAGES set up the EUROPAGES Observatory whose aim is to define the expectations, issues and behaviour of European SME decision-makers so as to help them identify the most efficient international practices and to implement these by carrying out ad hoc international studies and research. Latest studies by the EUROPAGES Observatory*: • 2007 – German SME’s and exports 1 007 German SME’s questioned about their export strategies and their international advertising means. • 2006 – Are French SME’s successful internationally? 1 030 exporting French SME’s reveal their ambitions, the obstacles to their growth and their strengths. • Online international goods, service and B2B service searches (annual) Survey based on the analysis of world Europages.com website consultations * Reports available free of charge on request (press@europages.com)

5. Aim & method • The aim of this study was basically to determine whether regularly using the Internet matches a particular SME profile both globally and according to individual countries, and whether this use leads to specific behaviour and performance compared to SME’s in general. • The results and lessons presented in this report are the result of a survey carried out between 20 November 2007 and 5 February 2008 in the www.europages.com website’s 26 language versions used by internationally active companies (import and/or export) from 218 different countries. The questionnaire was available in 6 languages: German, English, Spanish, French, Italian and Dutch – English was by default used by the www.europages.comwebsite’s other language versions. The data was collected by spontaneously visiting the website and via e-mailing. The SME’s which answered all regularly use the Internet to promote their import and export activities. • 3 438 companies accepted taking part in the survey, all business sectors included (cf. participating company profiles on page 8). • Only countries with a significant sample of participants for reliable statistical use of the results were chosen: Germany (916 companies), Spain (387), France (760) and Italy (598). • The data processing as well as the analysis of results were carried out by the OpinionWay Institute.

6. About the observation criteria • Particular attention was paid to certain criteria so as to narrow down the analysis of the information collected.

7. -  Significativity test • In the results given, significant developments are shown by the following symbols: • Compared to the total for all countries: using a Chi 2 test we looked at whether the results from different countries analysed differed significantly compared to the total results. • In cross sorting tables, only figures which are significantly higher or lower than the total are coloured (red if lower, blue if higher).

8. Profile of participants • Main activity – Industrial companies dominate • 44% of companies which took part in the study (all countries included) either produce or manufacture. This score is higher in Spain (52%) and Italy (64%). • The services sector is in second place (23% on average). Germany and France are overrepresented (26% and 29%). 2. Company size – Very small & small enterprises • 39% of companies which took part in the study are very small enterprises (1 - 9 employees). Unlike other countries, their number in Germany is markedly higher than this average (48%). • 41% are SME’s with between 10 and 49 employees, the highest percentages are in Italy (52%) and Spain (47%). 3. Company age seniority – Over 10 years • ¾ of companies from the sample have on average been in existence for over 10 years. This score is highest in Germany (83%), Italy (80%) and Spain (81%). See the profile of participants and their companies

9.  No Yes - - Germany France Italy Spain Total I. Import trends • A high level of imports for participating companies • Over half the companies in the sample said they imported. Spain was the top importing country with 62% whilst France and Italy were further behind with 52% and 46%. • More specifically, in all these companies the activities most concerned by imports are production/manufacturing, distribution and the wholesale trade, especially in business sectors linked to mechanical engineering/the engineering industry and textiles/clothing. It is also worth noting a higher import level in more mature companies (set up over 5 years ago, in some cases over 10 years ago). (cf. tables 1 and 2) Does your company import? Total

10. I. Import trends 2. A tendency to level off in future imports • A similar trend in terms of purchasing abroad can be observed in both Germany and Spain with approximately 1/3 of purchases made abroad. France seems to purchase more abroad with an average of 39%. Only Italy appears to be lagging behind with an average of 29% of purchases abroad. What percentage of all your purchases are made abroad? Spain Total Germany France Italy Key: ST = Sub Total Import ing companies

11. Decrease  Level off Increase - Total Germany France Italy Spain I. Import trends • We can see the projected level of imports levelling off since over half the companies questioned forecast an identical level for next year. Only Spain seems to be divided between stability and growth (with 47% stability and 47% growth). Out of all the comapnies which took part in the survey, only very small enterprises, distribution companies and the wholesale trade envisage growth in their imports over the coming year (cf. table 3). Do you forecast that next year your imports will: Importing companies

12. I. Import trends 3. EU-15, the preferred area for imports • The original 15 EU member states are the priority import area for importing companies in the four countries chosen (with rates of between 70% for Italy and 84% for Spain). Italy, Germany, France and Spain are the four major importing countries. • Some specificities can be observed however according to the different countries: Germany comes out top for France and Italy (50% and 41%), Italy is preferred by Germany (40%) and Spain (46%). • Other import areas: the German companies which took part in the survey seem to prefer all other European countries (namely the Netherlands, Austria and Poland). French companies cultivate a high level of exchanges with Belgium due to their geographical proximity. This phenomenon can also be observed in Spain with regard to Portugal. Which countries does your company import from? Total Germany France Italy Spain Importing companies

13. 1 1 1 1 2 2 2 2 3 3 3 3 I. Import trends Which countries does your company import from? It. It. Ger. Ger. Fr. Fr. It. Fr. 3. EU-15, the preferred area for imports • Details Europe: N eth. Ger. Spa. Spa. Spain Total Germany France Italy Importing companies

14. I. Import trends What countries does your company import from? 3. EU-15, the preferred area for imports • Details Central & Eastern Europe: Spain Total Germany France Italy Importing companies

15. I. Import trends What countries does your company import from? 3. EU-15, the preferred area for imports • Details East Asia & Oceania: Spain Total Germany France Italy Importing companies

16. No   Yes Italy Total Germany France Spain - - - No Yes Total Germany France Italy Spain II. Export trends • A high level of exports with a tendency to develop • 65% of companies which took part in the survey said they export. Germany is in the lead with 70% and Italy is slightly behind with 61%. More precisely, out of all the companies which took part in our survey, those which produce/manufacture and those in the wholesale trade, namely in the metallurigcal industry, mechanical engineering and textiles/clothing export most (cf. tables 4 and 5). • Currently almost 1/3 of non-exporting companies envisage exporting in the future. This score is logically higher for Italy (42%), which exports less than the other countries. The companies most concerned by this development are very small enterprises which produce/manufacture or distribute in the mechanical engineering and textiles/clothing sectors (cf. tables 6 and 7). Does your company export? Total Do you intend to export in the future? Non-exporting companies

17. II. Export trends 2. A positive trend for export turnover • On average 37% of turnover in all the companies which took part in the survey comes from exports. For French companies this figure is 35%, the other countries are close with a figure of approximately 34%. More precisely, SME’s (50 - 199 employees) and large companies make the largest export turnovers, namely in the field of mechanical engineering (cf. tables 8 and 9). What percentage of your company’s overall turnover comes from exports? Spain Total Germany France Italy Average percentage: Key: ST = Sub Total Exporting companies

18. Decrease   Level off Increase - - - Germany France Italy Spain Total II. Export trends 2. A positive trend for export turnover • For the coming year, all the companies which took part in the survey foresee an increase in their export turnover (56% on average). Spain was the most optimistic with 67%. In Germany, despite being the largest exporting country, this figure was lower (49%). Italy is also a little less optimistic with 51% of exporting companies which foresee an increase in their export turnover. The most positive companies are SME’s (50 - 199 employees) and large companies, which already make over 40% of their turnover from exports, namely in the agri-food industry (cf. tables 10 and 11). Do you foresse that next year your exports will: Exporting companies

19. 1 1 1 1 2 2 2 2 3 3 3 3 EU EU EU EU W EU Afr. Afr. W. EU Eur E -U EU W EU E-U II. Export trends 3. EU-15 confirms its dominating position as an export destination • The EU-15 is the preferred export area with export levels of between 81% for France and 92% for Spain. • France, Belgium, Spain, the United Kingodm and Germany are the top five countries for exchanges. We can however observe certain specificities: Austria is Germany’s preferred export country as is Belgium for France. • Other export areas: Germany, a major export country, is presents on all fronts, including most European countries as well as Asia and Russia. France also focuses on Africa whilst Spain concentrates on South America due to their common language. What countries does your company export to? Total Germany France Italy Spain Exporting countries

20. 1 1 1 1 2 2 2 2 3 3 3 3 Aus Bel Ger Fra Fra Ger Por Fra Net Spa Ger Spa II. Export trends What countries does your company export to? 3. EU-15 confirms its dominating position as an export destination • Details Europe: Total Germany France Italy Spain Exporting countries

21. II. Export trends What countries does your company export to? Total Germany France Italy Spain 3. EU-15 confirms its dominating position as an export destination • Details Central & Eastern Europe : Exporting countries

22. II. Export trends What countries does your company export to? 3. EU-15 confirms its dominating position as an export destination • Details East Asia and Oceania : Total Germany France Italy Spain Exporting countries

23. 1 1 1 1 2 2 2 2 3 3 3 3 EU EU EU EU W EU Am E-U. Rus Rus E-U Afr W EU II. Export trends • The EU-15’s domination is tending to become increasingly consolidated since all the companies which took part in the survey want to export more to this area. • Furthermore, German companies, at the heart of exchanges with a large number of countries, envisage increasing their exports to all European countries, Russia, Asia and Turkey. France wants to consolidate exchanges with Africa. Spain capitalises on South America. More specifically, which countries do you intend to export more to? Spain Total Germany France Italy Exporting companies whose exports are set to increase

24. 1 1 1 1 2 2 2 2 3 3 3 3 Aus Fra Ger Fra Fra Ger Spa. Ger UK Por UK Spa II. Export trends More specifically, which countries do you intend to export more to? • Details EU-15 : Spain Total Germany France Italy Exporting companies whose exports are set to increase

25. II. Export trends More specifically, which countries would you like to export more to? Total Germany France Italy Spain • Details Central & Eastern Europe: Exporting companies whose exports are set to increase

26. II. Export trends More specifically, which countries would you like to export to more? Total Germany France Italy Spain • Details East Asia & Oceania: Exporting companies whose exports are set to increase

27. 1. Very active in terms of imports and exports Imports: 55% Vs 5% of all French SME’s * 100% 38% 45% 45% 48% 75% 54% No 50% 62% 55% 55% 52% 25% 46% Yes 0% Germany France Italy Spain Total Italy Total Germany France Spain No Yes III Other lessons • Exports: 65% • Vs 4% of all French SME’s • 13% of German SME’s* France and Italy are behind in terms of imports Italy is behind in exports Does your company import? Does your company export? * Sources: French National Institute of Economic & Statistical Information, Customs

28. 2. Geographical origin and destination of exchanges Pre-eminence of EU-15: 79% imports, 87% for export. High score of German SME’s in Central & Eastern European countries and China;French SME’s in Africa, and Spain in South America. Germany France Italy Spain Total EU-15 East Asia & Oceania Wider EU USA, Canada & Mexico Other Asian countries Other European countries Germany France Italy Spain Total EU-15 Wider EU USA, Canada & Mexico Other European countries East Asia & Oceania Africa Middle East Russia Other Asian countries Central & South America Turkey III Other lessons Favourite import areas Favourite export areas

29. III Other lessons 3. Average number of import destinations: • On average all the companies which took part in the survey said they imported from 3.6 countries. • French and German companies are in the lead with 3.8 and 3.7 import destinations, followed by Spain with 3.4 countries and Italy further behind with 2.9 import destinations on average. NB. These results were obtained excluding exclusively import companies so as to remove any bias.

30. III Other lessons 4. Average number of export destinations: • On average all the companies which took part in the survey said they exported to 8.7 countries. • German companies are a long way ahead with 10.7 export countries on average, followed by Italy (8 countries on average), France (7.8) and Spain further behind (6.9). NB. These results were obtained excluding exclusively export companies so as to remove any bias.

31. III Other lessons 5. Quality & know-how: key advantages of exported products • Quality / know-how is the main asset of products exported for all the companies which took part in the survey (75% on average). • This advantage is most heavily marked with French companies (80%) to the detriment of price (25%) and creativity (18%). Germany also focusses on the specialisation/uniqueness of its products (58%) whilst Spain also differentiates itself with prices (44%). • In terms of business sectors, mechanical engineering companies seem more focussed on quality and the specialisation of their products, the agri-food industry on price, as well as textiles and clothing which are also based on design and creativity (cf. table 12). What are the strengths of the products you export? Spain Total Germany France Italy Exporting companies

32. III Other lessons 6. Internet advertising, the top advertising medium • Internet advertising is the top advertising means used by all the companies which took part in the survey (58% on average). French companies (46%) are lagging behind and continue to give priority to trade-fairs with stands (52%), whilst German SME’s are the largest users of Internet advertising (69%). Spain and Italy, however, still place more trust in catalogues and leaflets (60% and 53% respectively). • More specifically, out of all the companies which took part in the survey, those which invest most in advertising are ‘‘large SME’s’’  (50 - 199 employees) and those with over 200 employees and an export turnover greater than 40%. These heavily committed export companies are more capable of investing in advertising with the aim of increasing their exports, namely in the mechanical engineering sector (cf. table 13 and table 14). Which of these advertising tools have you used over the last 12 months? Total Germany France Italy Spain Exporting companies

33. III Other lessons 7. Advertising on a company’s own website, a major means of advertising on the Internet • All the companies which took part in the survey give priority to advertising on their own websites (95% on average). • Pay advertising in search engines namely stands out in Germany (34% of use) and Spain (25%), followed by pay advertising on sector-based specialist sites (16% in Germany, 15% in France and 19% in Spain) and in specialist online directories (with 17% for Germany). What types of Internet advertising have you used? Spain Total Germany France Italy Companies using Internet advertising

34. Recap I – Imports • Level of imports • Over half the companies which took part in the survey import. Spain has the highest level (62%), France and Italy are further behind (52% and 46%). • The business sectors most concerned by imports are manufacturing, distribution and the wholesale trade. 2. Percentage of purchases abroad – Tending to level off • The behaviour of companies with regard to purchasing abroad is similar for both Germany and Spain with around 1/3 of purchases made abroad. On the other hand, France seems to buy more with 39% on average and Italy is further behind with an average of 29% purchases made abroad. • We can observe a certain stability for imports in the future since over half the companies which took part in the survey foresee an identical level for the coming year. Only Spain seems to have more mixed opinions about stability and gorwth (47% stability and 47% growth). 3. Import areas – EU-15, a privileged exchange area • The EU-15 is the priority import area for the 4 countries (with rates of between 70% for Italy and 84% for Spain). Italy, Germany, France and Spain are also the 4 major importing countries. • We can also observe several specificities according to the different countries: Germany is in the lead for France and Italy (with 50% and 41%), and Italy for Germany (40%) and Spain (46%).

35. Recap II – Exports 1. A high level of exports which is developing • 65% of companies which took part in the survey said they export. Germany dominates with 70% and Italy is slightly behind with 61%. These companies export within limits on a considerable number of markets. • Almost 1/3 of companies which do not currently export envisage exporting in the future, a score which is logically higher for Italy (42%), which exports less than the other countries. 2. Percentage of export turnover – a positive trend • On average, 37% of the turnover of the sample’s companies comes from exports, the 4 countries studied are quite close (35% on average for France and Italy, 34% for Germany and 32% for Italy). • All the companies which took part in the survey foresee an increase in their export turnover (56% on average). Spain appears the most optimistic with 67%, on the other hand Germany seems further behind (49%) despite the fact it is the the biggest exporter. Italy is also a little less optimistic with 51% of exporting companies which foresee an increase in their export turnover. 3. Export area –EU-15 confirms its domination • The EU-15 is the privileged export area with export levels ranging from 81% for France to 92% for Spain. • France, Belgium, Spain, the United Kingdom and Germany are the top 5 countries in exchanges. We can however observe several specificities: Austria is the preferred export country for Germany as is Belgium for France. • The EU-15’s domination which is becoming more consolidated since all the companies which took part in the survey want to increase their exports to this area.

36. Recap III – Other lessons 1. A large import and export activity • 55 % of companies import (5% of all SME’s for France…) • 65 % export (4% of all SME’s for France, 13 % for Germany…) • With the exception of German companies –slightly more successful at exporting, we can say that French SME’s are almost on a par with their European counterparts. 2. Origin and destination of commercial exchanges • Pre-eminence of Europe-15 (79% for imports, 87% for exports) 3. Average number of import countries: • On average, all the companies which took part in the survey said they import from 3.6 countries. • French and German companies are in the lead with 3.8 and 3.7 import countries, followed by Spain with 3.4 countries and Italy further behind with 2.9 import countries on average. 4. Average number of export countries: • On average, all the companies which took part in the survey said they export from 8.7 countries. • German companies are a long way ahead with 10.7 export countries on average, followed by Italy (8 countries on average), France (7.8) and Spain, further behind (6.9). * NB. These results are obtained by excluding companies whose sole activity is importing or exporting so as to remove any biais. These figures particularly highlight the dynamic nature of companies which use the Internet internationally. If we compare these data with those of exporting French SME’s (source French customs), we can see that in 49% of cases the latter only export to one single country, and 63 % to 2 countries only! We can also observe that French SME’s in the sample have a profile very close to their European counterparts and are on a par with them (especially German companies) with regard to both imports and exports.

37. Recap 5. The key advantages of exported products – Quality and know-how • Quality / know-how is the main strength of exported products for all the countries (75% on average). • This advantage is more pronounced with French companies (80%) to the detriment of price (25%) and creativity (18%). Germany also uses specialisation/uniqueness (58%) whilst Spain also stands out with the prices of its products (44%). 6. Means of advertising used –Internet advertising • Internet advertising is the top means of advertising used (58% on average), except for France (46%) which still prefers trade-fairs with stands (52%). Germany, on the other hand, is the big Internet advertising user (69%). Spain and Italy privilege catalogues and leaflets (60% and 53% respectively). 7. Type of Internet advertising – On company websites • All the companies which took part in the survey privilege advertising on their own website (95% on average). • Pay advertising in search engines has developed rapidly, especially in Germany (use 34%).

38. APPENDICES

39.  - - Profile of participants Sex: 1. Type of participants – Mostly men (return) • Approximately ¾ of those who took part were male. The largest proportion was in Germany (79%) and slightly less in France and Italy (64% and 66%). Female Male Total Germany France Italy Spain Total

40.   - - - Profile of participants Age 2. Age of participants – Between 35 and 54 years old (return) • Over half of participants were between 35 and 54 years old. German participants were the oldest (34% over 54 years old) and Spaniards were the youngest (30% 25 – 34 years old). 55+ years old 35-54 years old 25 - 34 years old Total Germany France Italy Spain Total

41. Profile of participants What is your position in the company? 3. Position of participants – Mostly managers (return) • Over half of participants have a managerial position within the company, especially in Germany (63%). Total Germany France Italy Spain Total

42. Profile of participants • Main activity – Mostly industrial concerns (return) • 44% of companies which took part in the survey (all countries together) manufacture or produce. This score was higher in Spain (52%) and Italy (64%). Service providers were in second position (23% on average), Germany and France being overrepresented (26% and 29%). What is your company’s main activity? Spain Total Germany France Italy Total

43. Profile of participants 5. Business sector (return) • Metallurgical industry, mechanical engineering, agri-food industry, B2B services and textiles/clothing are the 5 main business sectors for all the companies which took part in the survey. • Germany was mostly focussed on mechanical engineering, France on B2B services, Italy on mechanical engineering and textiles/clothing, and Spain on the agri-food industry. What is your company’s business sector? Spain Total Germany France Italy Total

44. Profile of participants 6. Company size – SME’s & Very Small Enterprises (return) • 39% of companies which took part in the survey are very small enterprises (1 - 9 employees), especially in France and Germany (48% and 40%). • 41% are SME’s (10 - 49 employees), especially in Italy (52%) and Spain (47%). Workforce Spain Total Germany France Italy Sub- Total VSE Sub-Total SME A Sub-Total SME B Sub-total LC Total Key: VSE = Very Small Entreprises, SME = Small & Medium-Sized Entreprises, LC = Large Companies

45.    Over 10 years 5 - 10 years 3 - 5 years 1 - 3 years - Less than 1 year Germany France Italy Total Spain Profile of participants How long has your company been in existence? 7. Company Age – Over 10 Years (return) • ¾ of companies which took part in the survey have on average been in existence for over 10 years. This score is higher for German companies (83%), Italian (80%) and Spanish (81%) companies. Total

46. Appendices • NB : • *= Note, small total (< 30) • Reminder: only figures significantly higher or lower than the totals are shown in colour in the tables (blue if higher, red if lower). • Import levels (tables 1 & 2) (return) Q6: Does your company import? Total

47. Appendices Q9: Do you foresee an increase in your imports for next year? • Development of purchases abroad (table 3) (return) Importing companies

48. Appendices Q10: Does your company export? • Export levels (tables 4 and 5) (return) Total

49. Appendices Q19: Do you intend to export in the future? • Intention to export (tables 6 and 7) (return) Non-exporting companies

50. Appendices Q12: What percentage of your overall turnover comes from exports? • Export turnover (tables 8 and 9) (return) Exporting companies