Iran: What prospects for French SMEs?

Gradually and surely, the Islamic Republic of Iran is gradually opening up to the world, at least economically speaking. Tehran is now in the sight of a colossal number of companies. And for good reason: it is a rich, industrialized and evolving country. There appear many needs in all sectors, which open almost immediately overnight. It is not every year that such an opportunity presents itself.

There are business opportunities in all sectors: energy, transport and infrastructure, industrial equipment, health, etc. There are plenty of areas for development. But French companies are lagging behind! They are still very poorly represented in Iran, and as we know, once the place is taken, things are much more difficult ...

Mega Total contract in Iran: If it does, what prospects for French SMEs?

The main French oil company has signed an agreement in principle with Tehran in the amount of $ 4 billion. The agreement authorizes the exploitation of the world's largest "South Pars" natural gas field in the Persian Gulf (approximately 14 000 billion cubic meters of gas, or 8% of the world's reserves), a symbol of the magnitude of the opportunities Offered by Iran. The French company has thus become the first Western oil company to return to the Islamic Republic since the lifting of the sanctions decreed in 2012. Subject to the fact that it is not called into question by the American positions on Iran, given Trump's stance on the Iranian nuclear agreement.

 

In the wake of a contract like this one, hundreds of subcontractors will be solicited. So there are some good places to take, especially since the Iranian market is showing some kind of amenity for companies that are willing to settle in the country. And Iran has the advantage of the market premium at the first access: it favors the intuitu personae and the long-term relationship. The size of SMEs encourages this kind of human exchange, which allows us to lay a solid, preliminary and inevitable basis for negotiating contracts with Iranian companies. A well-managed opportunity, benefiting from a favorable environment, can lead to a more than significant volume of business, with multi-digit growth ...

Prospects provided you prepare

Attacking the Iranian market can not be done without taking some precautions before. Indeed, the obstacles are numerous because it is a country in which the State is omnipresent and where the culture of business is very different from what is known elsewhere. The breakthrough of the Iranian market can only be achieved within a rigorous framework where the company will have to do a double task both on its mode of reasoning and on the nature of the actions it will have to take to conquer this new market .

Otherwise, the risks are multiple and occur at three levels: First, without a subtle and strategic approach to the market, no business perspective is possible. This means for the company a significant loss of energy, time and money, for a zero result at the end. Moreover, even if there are trails, getting them to do so is another matter: because of many misunderstandings, the inability to agree with local customers is problematic. This risk and all the stronger the Iranian culture is singular. Finally, the last risk is to achieve concrete markets but it is sometimes ... impossible to get paid! The higher the risk level, the greater the losses for the company. It is better to take the lead in order to avoid these various disappointments.

Conclusion: Drawing on local experts who know the country and its culture

It is impossible to attack Iran as one would attack Sweden. This market offers great potential, but it can only be accessed by relying on local, seasoned experts who know all the cultural, administrative, regulatory and customary contours. Without these valuable advisers, the risk of breaking the nose is great!