Challenges foreigners face in Bulgaria
Well, it is not easy to be a foreigner in any country. Although there are countries which are more welcoming to foreigners it takes some time to get familiar with the culture and people at your new home. Nowadays, Google can help a lot in your initial research and you definitely should do your homework before making decisions to move and packing your suitcases. But nothing can help you more than the personal experience of others like you. We at Olsen and Partners are used to working with foreigners doing business in Bulgaria, or managing branches of foreign corporations here. Our typical clients are small business owners, freelancers, and professionals (CEOs, lawyers, etc.). Based on our experience and our customers´ shared personal stories we have prepared this article, hoping to help every newcomer and to prepare him/her about what to expect from Bulgaria.
We believe that the first challenge for every foreigner is the Bulgarian mentality, the local culture and customs. Many foreigners do this same mistake: they try to apply their mentality and culture and they always fail. Often at the cost of tens of thousands and more euros lost. Many say: Bulgaria is EU member, so it´s the same as the rest of Europe. Yes and no. Yes, the legislation is harmonized, but the people are different. You must understand that Bulgaria is an ex-communist country and Bulgarian people have a different mentality. Try to get to know more Bulgarians and to understand how they think, how they act and compare them to yourself and your way of thinking. Keep in mind that you can change many things in this world, but you can never change people´s mentality.
Let´s review what our foreign clients and friends share on this matter:
Rodrigo: You definitely need to consider the mentality and cultural differences. Bulgarian people are not bad in general, but you should not trust everyone blindly. An average Bulgarian will never take the initiative, instead he would wait for his boss’s instructions, even for small issues. One good example: when our office manager is on vacation and I’m looking for paper or a bottle of water and we are out of stock, I ask the office staff why they hadn’t ordered supplies and they would tell me: “nobody told us to”. Zero initiative! It took a lot of time and hours of conversations in order to teach them and we still have issues. Bulgarians in general cannot figure out that business is a team work and if there is failure, it is a company failure and if we succeed, all of us will benefit. Bulgarians are not team players by nature. You should work on training them, talking to them tirelessly. But don’t be foolish to think your training will be sufficient to teach them. You can improve, but not completely transform people.
Dima: I was shocked to understand that my personal assistant had witnessed a colleague fighting rudely with a customer on the phone and did nothing to stop it. And then, she came to me sharing the story, telling me how unprofessional her colleague had been. When I asked her what she had done to stop him, she answered that it was not her job to say anything to him. I couldn´t believe my ears! She only cared about her daily responsibilities. I tried to explain that if we lose this client, we lose revenue and we would not be able to increase her salary, for instance. To date, I still fight with this mentality at the office. On the other hand, Bulgarians are always ready to stay late at the office if needed, they are not clock-watchers.
Peter: One big difference for us is the fact that Bulgarians are not positive people and they rarely smile. It is hard to see people smiling, people saying ´good morning’ or ´thank you´. It reminds me of the time when I was in Russia. It doesn´t mean Bulgarians are not friendly or social but their first reaction is always negative. If you ask for their opinion, they will always start with the negative side and may never share anything positive. Bulgarians consider that it is important to prepare for a negative scenario because if a positive one comes, it´s always easy to face it. Bulgaria is ranking very low in the world happiness chart. People here are not happy but you can try to make your team happy and this will make the difference at least at your office.
Marco: At first, Bulgarians are very skeptical to everything new or to big changes but they are very adaptive people. The boss is always the boss and they would never argue with him/her, would not tell their boss openly if they don´t like his/hers ideas. They will adapt and follow you. It´s difficult to find creative people or leaders. Do not expect somebody at the office to take the initiative. They wait for you to guide them. Don´t expect that a big salary will motivate them more. Not at all! It doesn´t mean they wouldn´t like big salaries, but there is almost zero relation between salary and motivation.
Karen: It´s difficult to find somebody who can think outside the box. Do not forget that this is an ex-communist country. Bulgarians don´t trust each other but they trust foreigners a lot and you can take advantage of that. There is no solidarity in the Bulgarian society. Once you find good people and motivate them, you can do miracles. Bulgarians work a lot, they will stay after office hours if they have outstanding work to finish, it´s not like Europe.
Bureaucracy and corruption
Rodrigo: Whatever you do here, you will need to contact a government office. Expect a wall of bureaucracy. They will ask you for tons of papers, always with a POA. The stamp is something critical in Bulgaria, you will always need it. I´ve seen business people with a stamp in their pocket even at the night club. You need a lot of patience and good lawyers and accountants in order to survive. There is no other way!
Marco: I can’t imagine myself surviving here without a good accountant. The corruption is everywhere, in every level of government. First, they ask for the impossible, to submit papers you most likely don’t have or cannot obtain in the near future. Then they say: “well, we can help you, but it will cost you…” If the traffic police pulls you over on the street/road, you should always have at least 20 leva prepared in your pocket or wallet, that’s the regular “tariff” for minor traffic violations (they don’t even bother suggesting to punish you in the official order, because they wouldn’t get anything out of it).
You should consider that Bulgarian is not a Latin based language. It´s a Slavic language and difficult to learn, in my opinion. Many young people speak English, but you cannot rely too much on that. Why? Nobody at the government administration offices will talk to you in English. When dealing with them, you need to go there with somebody who speaks English and Bulgarian to help you, or you can also send somebody with a POA on your behalf (which will cost you money). Furthermore, it´s difficult to find any official government documents in English. At some bank offices you can find people who speak some English, but it´s not that common. In stores, restaurants, clubs and on the streets, it is difficult to find somebody speaking decent English, especially if you are outside of Sofia city center or big resorts. Although Bulgarians are friendly, communication is a big challenge.
Oliver: At the office we always have people speaking very good English but outside of it it’s an issue. I have never been able to talk directly with somebody from the administration. I always need a translator. Bulgaria is a beautiful country, full of culture, picturesque villages and nice people, I love travelling and exploring the country. When travelling, language is a big challenge. Almost nobody speaks English besides younger people in bigger cities – Sofia, Plovdiv, Varna and Burgas. You can survive without knowing Bulgarian, but it sure is good to know it. On the other hand, restaurants are very inexpensive and you can find really good food in Bulgaria; there are amazing Bulgarian wines, which are really cheap; most services are cheap too.
Rodrigo: Even at the immigration office they don´t speak English. I have nothing further to say.
Well, this is the most difficult challenge – to tell you about the judicial system in Bulgaria. It would be better just to share some of the experiences of our clients.
Luis: If you don´t have or manage a big company and cannot go to your embassy to look for help (they usually help medium and large businesses), don’t rely on justice in Bulgaria. There is no fear of justice. It can take years (5, 7, or even 10) to have your case solved. Your competitor can easily find a judge to bribe and then the law doesn’t matter. There are even cases in which people steal someone else’s business with the help of some corrupted judge. Be careful, if your business requires daily work with the justice system, Bulgaria is not the right place for you. The same applies if you have strong Bulgarian competitors with connections in the government. If this is not your case, however, you’ll be fine. If more complex situations arise, you will survive with patience and a good lawyer.
Local business environment
Jesus: As soon as you get there, try to learn about the local business environment, it´s much different than Europe. Do not be foolish enough to think that Bulgaria is EU member, so it´s the same as Europe. If you are lucky to have foreign business partners working in Bulgaria, you are okay. But if you need to work with local companies, try to find a good contractor prior to coming to this market. Be prepared for corruption, even at company level. For example, if you want to buy a car, or even furniture for your office and you assign this task to your employee, he/she will first look for a friend or somebody who will pay him/her a commission and then he/she will present you the proposal. Your employee will not care if the proposal is the best for the company.
Marco: Careful with collections. Many local companies don´t pay on time and it´s difficult to collect. Do not rely on the contracts you´ve signed, there is no fear from the justice system. The justice system may work for big companies who are protected by their embassies and have the resources to go to lengthy trials with good lawyers on their side. Sometimes you feel as if you’re in a jungle. But relax, this is the price to pay for having low taxes. Find good local employees and you´re safe, you can make a lot of money in Bulgaria.
Oliver: There is no stability, it´s difficult to make plans in Bulgaria. Actually, Bulgarians are not used to making plans. They live for the moment. The laws are changing frequently, your Bulgarian competitor may easily find some lobbyist to help him change some law or rule in his favor and then you are losing money and cannot do anything about it. There is no institutional stability. There is high political risk.
Luis: There is no fair play when it comes to competition. If you manage a medium to large business, it´s very likely that you have a strong Bulgarian competitor that has enough connections with the government. In that case, you’re better off not getting involved and leaving the country. You cannot survive against such Bulgarian competitors. There is no fair market in these cases. They use a lot of methods, including criminal people against you. Stay away! How to figure out if that’s your case? Before starting anything in Bulgaria, find a good lawyer or accountant, they will tell you. If your business is small or your target market is outside of Bulgaria – this is the right place for you, nobody will bother you and you can make tons of money and benefit from the low taxation.
In conclusion, we can summarize that, indeed, Bulgaria is a very controversial place for business. There are rules, which are not always being abided by and you cannot always feel secure and protected by the local authorities. It is hard to find good employees, but this often comes from the fact that employers want to find someone good at the cheapest possible price and people with experience cost money. However, these shortcomings can also be looked at as benefits, because with the proper vision and motivation, the local market provides endless possibilities.
Furthermore, the negative effects of the Bulgarian business environment are more applicable to medium and large businesses and it also depends on how large the business is, because companies with huge resources, such as Hewlett-Packard, Nestle, Metro Cash and Carry, Billa, Coca Cola, Suchard, Henkel, Chipita, etc. have been thriving here for many years. In fact, Hewlett Packard has chosen Bulgaria to be its largest outsourcing center world-wide. Many other foreign companies have decided to do the same thing and Bulgaria has become one of the top 10 outsourcing destinations in the world. And why not, we have low taxes and cheap labor force – isn’t that exactly what every business needs in order to be successful?