The Netherlands is Small but Significant in The European Manufacturing Market

When you think of the Dutch, you don’t tend to think of a manufacturing economy. With such a small economy to maintain and an advanced economic system, the Dutch manufacturing industry sometimes gets overlooked. While most Dutch companies handle their manufacturing off shores, there has been a recent tendency to reshore locally to the Netherlands. Recent years have shown progress in the Netherlands for both private and public manufacturing sectors. In 2014, the Minister of Social Affairs and Employment made a 600 million Euro investment in Dutch manufacturing. These are some of the newest staples in the manufacturing industry of the Netherlands.

During the global economic crisis that rocked the world, the Netherlands suffered a massive blow, especially in manufacturing. Recently, that dynamic has changed and we see improvement in the region. First, medium-sized manufacturers are doing better than large companies. In 2014, Capitalmind’s Fabulous Forty Industrial Markets showed an increment in growth in Dutch industry for businesses making about 50 million Euros a year. Keeping a tight ship is easier under a middle-sized company, and the Dutch economy seems to benefit from these specific plants.

Reshoring in the Netherlands

Like in the United States, reshoring in the Netherlands is also gaining momentum little-by-little. A lot of companies that once sent production to China are reconsidering the benefits of reshoring to the Netherlands for multiple reasons. The first, and the most important, reason is that patenting and licensing in China is hardly respected. It’s difficult to maintain a quality product when cheaper unauthorized copies are made that could tarnish a company’s reputation. Reshoring also lowers production costs in general, as well as gives away direct, local supervision to the production process. Netherlands based companies are becoming more and more enlightened by these effects and bringing manufacturing back home.

Offshoring to the Netherlands

New companies are also coming to the Netherlands, producing there and investing in the Dutch economy. The most recent is the Paul Mueller Company, a steel manufacturer from Missouri. This announcement, made in March of this year, demonstrates an apparent rise in the manufacturing industry in the Netherlands.  PMC’s 21-million-euro investment will create one facility joining all its other facilities in Groenlo.

Why Holland?

It’s tax structure is highly supportive of economic growth. The Netherlands has an incredibly advanced workforce with engineering and design skills ready to be utilized by companies looking to improve their production. But mostly, the Netherlands has a streamlined logistics and distribution network in Europe, giving companies proximity to their customer base. These characteristics make Holland stand-out and contribute to the recent industrial growth in this small, but significant European market.

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