Crack the Code: How to Expand Business to Portugal Without Failing
Expanding your business to a new country can be both exciting and challenging.
Portugal gathers a bunch of benefits, starting with the beautiful location and landscapes, the digitalization of processes, more affordable salaries, plus the time zone – closer to the US and perfectly manageable with other European countries.
There’s no doubt Portugal’s been standing out. Its strategic location attracts businesses wanting to expand into the European market. So, if that’s your case, you’re in the right place. However, you must understand the country's local culture, business practices, and unique opportunities to succeed in Portugal.
Discover how to expand your business to Portugal while navigating a crucial point: the culture.
Understanding Portuguese Culture: A Key to Successfully Expand Your Business
On top of the benefits, your company’s culture, your mission and values, and everything else you have to offer, there’s something crucial left to understand: Portuguese culture.
Whether you want to open a subsidiary in Portugal or employ workers via EOR, you must still navigate the country’s cultural nuances. That’s a key point since the beginning, so let’s dive into that.
Why is Portuguese Culture Important?
Portuguese culture plays a significant role in business and employee interactions. Portuguese value relationships and personal connections. So, it’s no surprise that building trust and rapport with local partners, clients, and employees is essential.
Understanding their culture can help establish solid connections and smoother business operations. According to the European Work Voices 2022/23, Portuguese are the ones who value most the sense of “work purpose” in a job – and that’s important information to retain when hiring these workers.
But do things change when it comes to the business culture?
What is the Business Culture in Portugal?
The business culture in Portugal is a blend of tradition and modernity. While Portuguese professionals are generally open to international business practices, they also respect their cultural heritage. Portuguese appreciate punctuality (though not super strict), but business meetings often start with informal small talk. Be patient and prepared for lengthy negotiations, as essential decisions take time.
All in all, Portugal has both an energetic and unhurried business culture.
People generally value relationships and the path leading to their creation. And you’ll probably be dragged to many meetings for that to happen – the truth is that the process takes time, especially if you want to close a deal.
Some industries, like law, finance, or government, have more hierarchical structures. As a result, relationships tend to be much more formal than in other companies – such as startups or creative businesses.
Contrarily to other nationalities, the Portuguese pride themselves on welcoming and making everyone feel at home. They strive to be understood, so don’t be surprised if they immediately speak in English. There’s no language barrier when doing business with renowned companies (even if small), but the same may not apply when contacting local, specific clients or suppliers. We won’t lie: it helps if you know Portuguese in those cases.
What Businesses Thrive in Portugal?
According to Business Leader, Portugal is an attractive country to invest in:
Real Estate
Tourism and Hospitality
Renewable Energy
Tech Startups
Agriculture and Agribusiness
Healthcare and Senior Care
Education and EdTech
The tech scene is undoubtedly growing in the country, not only for remote workers but for businesses looking to expand to Portugal. On top of that, the government has a bunch of incentives to keep foreign investment in the country flowing.
However, if you don’t know how the Portuguese business culture works, closing deals will be complicated.
Expand your Business to Portugal by Mastering the Cultural Protocol
Expanding your business to Portugal involves more than just understanding the business landscape. Sure, you need to understand hiring intricacies and avoid employees’ misclassification, but you must understand other less “technical” topics.
The cultural protocol is one of those. Once you understand what Portuguese values most, you’re good to go. It's about embracing the culture and respecting local traditions. Follow these tips to navigate cultural differences successfully:
Learn the Language: While many Portuguese professionals speak English, learning their language can go a long way in building relationships and understanding the local culture. Plus, you’re instantly making an empathic connection, which is crucial in every context.
Build Personal Connections: Networking is crucial in Portugal. So, we encourage you to attend local events, engage with the community, and foster personal connections with Portuguese. They value that, and in turn, you show a confident posture.
Respect the Hierarchy: Most Portuguese companies follow hierarchical structures. Showing respect for that and understanding who to address and when improves your business interactions. Plus, you show you care, which is every business’ goal.
Understand Local Laws and Regulations: Portuguese business laws and regulations are complex. But we can help you with that, ensuring you remain compliant at all times and avoid legal issues.
Adapt to the Pace: Patience is vital when doing business in Portugal. Though many decisions can happen fast, you need to prepare for a lot of bureaucracy. So don’t let your business plans go to waste just because. Be patient until you achieve your goals.
Expanding your business to Portugal can be rewarding but requires a deep understanding of the country's local culture, business practices, and unique opportunities. By embracing the Portuguese culture and following our tips, you can increase your chances of success. Portugal's business-friendly environment and warm hospitality make it an excellent choice for international businesses looking to thrive in the European market.
