De Lage Landen follows
Rabobank in deveioping
international markets
Rabo
band
De Lage Landen, or DLL for short, is a 100%-owned subsidiary of
Rabobank. In the Netherlands this rapidly growing company is
active in the area of financial services in the form of leasing, fac
toring, financing for private individuals, car leasing and debt-col-
lection. With four hundred employees in the Netherlands and
eighty abroad, a profit of more than 20 million Dutch guilders
was realized last year. Two years ago, De Lage Landen made a
start with its internationalization. We recently spoke with Hans
van Beerendonk, who since February has been manager Interna
tional Development at DLL.
Issue 4/September 22, 1989
lands for cultivation. There are also a num-
ber of companies, many in the agricultural
sector, with an agent or representative in
Spain.' Because of the low volume of trade
between the Netherlands and Portugal,
there are no plans at present to open an of
fice in Portugal. Barendrecht explains:
'There is, however, a great deal of trade be
tween Spain and Portugal. Being in Madrid
will enable us to keep up to date and estab-
lish contacts. We will try to determine from
Madrid if it would be in the best of interest
for the organization to establish a represen
tative office in Portugal.' Like the other for-
eign offices, the role of the office in Spain is
twofold: helping Dutch clients and looking for
possibilities to finance the international
agribusiness.
First working day 'The first days in the
office in Madrid will be a new experience.
We have to start from scratch and develop
Van Beerendonk was appointed to
set up the new offices of DLL
abroad. He carries out market re
search and keeps an eye on developments
for the future. 'You have to have a line of
march', he finds. 'Anyway, we are not the
cock of the walk in the market. We follow.
That means that the initial losses are con-
trollable. It requires quite an effort to
break open a market.'
In the Netherlands DLL is primarily en-
gaged in leasing, car leasing and factoring.
Financing for private customers has a na-
tional character. From a judicial and legal
point of view, it is rather difficult at the mo
ment to enter this market abroad. Says Van
Beerendonk: 'The distribution structure
plays an important role. In the Netherlands
we have the Rabobank offices as a dis
tribution channel. This is not the case
abroad. With leasing, car leasing and fac
toring we offer the entrepreneur the possi-
bility of supporting his own expansion and
solving his particular financing problems.
Europe is about to become one of the
largest markets in the world and this is
what we are focusing our attention on first.'
The Madrid office at Alfonso XII38.
initiatives ourselves. We will be arranging
meetings with Dutch companies in Spain to
make them aware of our presence and to
cement a number of existing contacts. We
Three countries At present De Lage
Landen is represented in three European
countries. In Belgium there is a joint ven
ture with Cera, a co-operative bank with
300 offices. Says Van Beerendonk: 'To-
gether we have set up CLP, Cera Lage Lan
den Products. This is a holding company
with subsidiaries for leasing, factoring and
car leasing. We have a similar co-operation
agreement in West Germany with ADCA-
BANK. This is the ADCA Leasing und Fac
toring Verwaltungsgesellschaft GmbH, a
holding company which encompasses a
car leasing company and a leasing com
pany. On the lst of May, in consultation
with the London Branch, we set up DLL
Financial Services Ltd., which aims at the
British market. At present, therefore, there
are three companies active and we have
great plans for the future. In mid-1990, we
are making a start in France.'
Future The italian and Spanish mar
kets are next in line. With them the most
important European markets are then cov-
ered. Van Beerendonk mentions that there
are plans for new activities outside
Europe: 'Attention is paid to them in our
already have quite a list. The Spanish mar
ket highly values personal relationships.'
Barendrecht concludes: 'Setting up a new of
fice is quite enjoyable.'
longterm policy. It has to proceed at a
speed that you can keep up. You have to
go into new international markets as a
profitable company. Initial losses must be
converted into profits in a relatively short
time. The second restriction lies in the per-
sonnel sphere. It is difficult to attract good
people. Moreover, a certain pioneering
spirit is required to go and work abroad.
There are cultural differences, language
differences, the way to the business is dif
ferent there... We are busy looking for suit-
able managers.' The third restriction lies in
the market. Says Van Beerendonk: 'Not
every market is suited to the products
that we have in our package. To give an
example: the German factoring market
lags behind that in England because of
legal restraints.'
Outside Europe 'In the Far East we are
researching, together with Rabobank's of
fice in Hong Kong, what possibilities there
are for factoring. America, too, is high on
our non-European priority list. But here too
there are restrictions in speed, in person-
nel, in capitalization', says Van Beeren
donk. 'Rabobank's New York Branch is, of
course, a tremendous base from which to
venture forth, but we can't do everything
at once.'
Environment Internationally, Van Bee
rendonk foresees a growth in activities.
Amongst others, environmental issues
have an effect on this. 'For many com
panies this means that they will have to
make quite a few - perhaps unforeseen -
investments, which come on top of normal
production costs. Leasing can then be an
attractive financial instrument. The same
is true for agribusiness. In view of the pol-
lution of the environment, we can expect
quite a few measures.' Van Beerendonk
discerns yet another trend: 'Use has be
come more important than possession. A
product such as leasing can take tremen
dous advantage of this. With factoring you
can see another development. Entre
preneurs, the smaller ones too, will contin
ue to pay more attention to increasing
their exports. Factoring helps entrepre
neurs to avoid financial risks in doing so.
This means that in international transac-
tions, with a product such as factoring, you
have a tremendous future.'
