Identifies common practices to be aware of when selling in this market, e.g., whether all sales material need to be in the local language.
Relationships are still very important in selling in Spain, sometimes as important as price or quality, especially in large account sales.
The decision-making process within a Spanish company is different from that in the United States:
- In Spain, top executives often make decisions that would typically be made at lower levels elsewhere.
- These executives take action after review by different departments, making the sales process longer.
- An initial "yes" can mean that the company will study the situation, but not necessarily that it will buy the product.
Additionally, once the Spanish potential partner of a U.S. firm has agreed to start a commercial relationship, the Spanish company normally expects the U.S. firm to translate all commercial brochures, technical specifications and other relevant marketing materials into Spanish. Decision makers at the Spanish firm may do business in English with the U.S. firm, but the communication from the U.S. firm to its clients should come in Spanish, if possible, due to an overall lack of proficiency in English.
Department stores, hypermarkets, shopping centers and very specialized outlets are introducing the customer fidelity concept, including client cards, cumulative discounts and special offers for frequent customers. E-commerce is having an effect on some traditional segments of the direct marketing sector, such as mail order. Selling techniques, taking into consideration local tastes, are very similar to those in the rest of the Western world.
Trade Promotion & Advertising
CS Spain’s primary objective is to help small and medium-sized businesses (SMEs) to enter the Spanish market. One of our most valuable tools is counseling, including identifying the best possible trade promotion strategies for specific products or services.
Commercial Service Madrid has close relationships with the main trade fair authorities, i.e. in Madrid, Barcelona, Valencia and Bilbao and actively supports leading trade shows in these cities.
The News Media
Spain has more newspapers and magazines per capita than any other European country. However, only 21.7 percent of Spaniards read the newspaper every day, a number that has been steadily decreasing for the past years. Despite low readership, newspapers still shape the news agenda and program content of broadcast media. Spanish newspapers tend to have an editorial line that favors a particular political group. (Source: AIMC-EGM as of 2019)
The main newspapers are:
- El País – center-left, regarded as the nation’s paper of record.
- El Mundo- centrist
- ABC – center-right
- La Razón – center-right
- La Vanguardia – centrist, based in Barcelona
- El Periódico – left-leaning
More than 140 different dailies (mainly local or regional) plus a dozen supplements are published in Spain. Sports daily newspaper Marca rates as the most popular. Despite Spain’s having formally recovered from the financial crisis of 2008, Spanish newsrooms still suffers the effects of a downsizing industry, where news consumption shifts from print to on-line. Newspaper companies have seen their advertising revenues reduced by more than 40 percent and all have suffered the impact of fleeing readers that now get their news from the internet (78.9 percent). Digital-only platforms, led by www.elconfidencial.com, have become leading players in the Spanish news market. All national dailies have on-line news sites, most popular among younger audiences. While these sites have growing readership, news agencies face the challenge of how to monetize their platforms beyond on-line advertising. Since the first quarter of 2020, all main national newspapers have created pay walls to access their sites.
Six major media holding companies own most of the media outlets in Spain. They are:
Virtually every Spanish home has a television (99.7 percent) and it is the most followed media (85,4 percent of all Spaniards).The average consumption TTV time was 213 mintues/day in 2019. Peak viewing hours are between 2:00-4:00 p.m. and 9:00-11:30 p.m., but in the last 25 years, the prime time in Spain has been delayed one hour, and currently takes place at 22.49 p.m.
State-run Radio Televisión Española (TVE 1, TVE 2 and the 24/7 channel TVE24H) and regional stations run by the autonomous governments have been supplemented by five national private commercial channels: Antena 3, Telecinco, La Sexta and Cuatro TV (in order of audience). A merger between Telecinco and Cuatro was finalized in 2010; both stations remain on the air. A second merger took place in 2011 between Antena3 and La Sexta in response to the latter’s dire financial situation.
About 56,9 percent of Spaniards listen to radio every day for almost two hours, mostly on FM channels, and radio remains the most-trusted news medium. Peak listening hours are early in the morning and late at night. Major radio stations and wire news services include:
Privately owned stations:
- Cadena SER, is the leading Spanish radio station with an average audience of 3.9 million listeners, 29,7% of the total audience share. Left oriented.
- COPE. Has surpassed Onda Cero as the second most popular station in the past year and currently has 3.3 million listeners, 24,6% of the audience share. Right-oriented, conservative, owned by the Spanish Church.
- Onda Cero, is down to third with to 2 million listeners, 12,3% audience share. Center-right oriented.
- Government-owned station:
- RNE, 1.3 million listeners 8,7% audience share. (Source: EGM)
Publicaly owned wire news service:
Privately-owned wire news services:
The U.S. Embassy’s Public Diplomacy (PD) (https://es.usembassy.gov/embassy-consulates/madrid/sections-offices/public-diplomacy/ ) section maintains active relations with the fullrange of Spanish media. PD actively pursues placement of policy and program material in the major Spanish media, primarily on foreign affairs, security, and international trade issues.
Pricing practices in Spain are similar to those of the United States, although markups tend to be slightly higher. There is greater transparency in agent and distributor commissions in Europe in comparison with the United States.
Products and services in Spain are subject to Value Added Tax (VAT, or IVA in Spanish). Presently, the general VAT rate is 21 percent.
- A reduced rate VAT of 10 percent is applied to certain goods and services including ingredients, animals and vegetables used for food products for humans and animals, goods used for agricultural activities, medicines for veterinary purposes, certain healthcare products, i.e. prescription glasses, prostheses, wheelchairs, crutches, bandages, etc.
- An extra-low rate of 4 percent is applied to basic foodstuffs such as bread, dairy products, eggs, fruit and vegetables, books and newspapers. Numerous items previously taxed at this extra low rate are now subject to the full 21 percent.
- VAT is not imposed in the Canary Islands, Ceuta and Melilla, but a general indirect tax is imposed in the Canary Islands. This tax was also increased in 2012, with the reduced rate increasing from 2 to 3 percent, the standard rate from 5 to 7 percent, and the top rates from 9 to 9.5 percent and 13 to 13.5 percent.
Payment terms are usually based on 15, 30, 60, and under certain circumstances, 90-day terms. Although there is an EU directive covering payments, common practice in Spain is that large corporations and large retailers negotiate or impose longer payment terms of up to four to six months. Timely reimbursement is also covered by Spanish legislation. The Spanish government has deferred payments in the past.
The current repayment time allowed is:
- Private companies up to 60 days
- Public administrations up to 30 days
- Public works up to 60 days.
The EU also looks to combat payment delays. All commercial transactions within the EU, whether in the public or private sector, primarily dealing with the consequences of late payment, are covered by Directive 2011/7/EU. Transactions with consumers, however, do not fall within the scope of this Directive.
Directive 2011/7/EU entitles a seller who does not receive payment for goods and/or services within 30 days of the payment deadline to collect interest (at a rate of 8 percent above the European Central Bank rate) as well as EUR 40 as compensation for recovery of costs. For business-to-business transactions, a 60-day period may be negotiated subject to conditions. The seller may also retain the title to goods until payment is completed and may claim full compensation for all recovery costs.
Sales Services/Customer Support
Spanish consumers are becoming more demanding when it comes to after-sales and customer service. At the industrial level, service and technical support remains an important competitive factor. After-sales service is a requisite for government procurement.
Customer service is not as developed as it is in the United States; though, the larger department stores and new retailers (usually foreign) have return policies similar to those in the United States. In recent years, customer and end-user organizations have gained ground in their effort to acquire greater protection and fair treatment for consumers. These entities are similar to the Better Business Bureaus. OCU (Organización de Consumidores y Usuarios) is the best organized of these entities.
OCU, Organización Consumidores y Usuarios
Calle Albarracín, 21
Tel: 902 300 187
Fax: 917 543 870
The producer is liable for damage caused by a defect in his product under the EU1985 Directive on Liability of Defective Products. The victim must prove the existence of the defect and a causal link between defect and injury (bodily as well as material). A reduction of liability is granted in cases of negligence by the victim.
The EU General Product Safety Directive requires the producer and distributor to notify the Commission in case of a problem with a given product. The Directive also includes provisions on product recalls, the creation of a European Product Safety Network, and a ban on exports of products to third countries that are not considered safe in the EU.
Legal Warranties and After-Sales Service
Under the 1999 Directive on the Sale of Consumer Goods and Associated Guarantees, professional sellers are required to provide a minimum two-year warranty on all consumer goods sold to consumers.
The remedies available to consumers in case of non-compliance are:
- Repair of the good(s);
- Replacement of the good(s);
- A price reduction; or
- Rescission of the sales contract
Local Professional Serivces
Local service providers focusing on EU law, consulting, and business development can be viewed on the website maintained by the Commercial Service at the U.S. Mission to the European Union.
It is recommended to acquire local legal advice before entering into any complex business transaction in Spain. A local attorney can guide and assist in the establishment of a subsidiary or a branch, carry out business transactions, represent a company in government contracts or establish residency in Spain.
Principal Business Associacions
The American Chamber of Commerce in Spain is the main organization that accepts membership from U.S. companies located outside of Spain. U.S. companies established in Spain are free to join local organizations, chambers of commerce, sectoral associations, etc.
CEOE – Spanish Confederation of Employers’ Associations million companies and self-employed entrepreneurs from all sectors and participating the Spanish Public Administration.
Turespana: Spanish Tourism Organization
Federación Española de Industrias Alimentarias y Bebidas (FIAB) (Spanish Food and Drink Industry Federation)
Asociación Española para el Comercio Exterior de Cereales y Productos Análogos (AECEC) - (Spanish Cereal Trade Association)
Almendrave (Almonds and Hazelnuts Exporters/Importers Association)
Confederación Española de Alimentos Compuestos para Animales (Spanish Federation for Prepared Foods, for Animals)
Federación de Industrias Lácteas (National Federation of Dairy Industries)
AFOEX (Oilseed Crushers Association)
Asociación Española de Importadores de Maderas (Spanish Timber Importers Association)
ANOVE (National Seed Breeders Association)
Asociación Industrial del Textil del Proceso Algodonero (National Cotton Processors Association Center)
PROPOLLO (Spanish Poultry Producers Association)
PROVACUNO (Spanish Beef Producers Association)
INTERPORC (Spanish White Pork Producers Association)
ASEPRHU (Spanish Egg Producers Association)
Llotja de Cereales de Barcelona (Barcelona Cereal Market)
Chambers of Commerce
American Chamber of Commerce in Spain. This organization Is a strong advocate for U.S. firms located throughout the country. It also has Spanish members, including leading Spanish multinationals.
Spain-U.S. Chamber of Commerce. Based in New York, this organization is open to U.S. and Spanish companies.
Spain-U.S. Chamber of Commerce – Miami. Open to U.S. and Spanish companies.
Cámara de Comercio de España (Spanish Chamber of Commerce). Umbrella organization for chambers of Commerce located throughout the country. Has close ties to the Spanish Government.
Cámara Oficial de Comercio, Industria y Navegación de Barcelona (Barcelona Chamber of Commerce, Industry and Navigation)
Cámara Oficial de Comercio, Industria y Navegación de Bilbao (Bilbao Chamber of Commerce, Industry and Navigation)
Limitations on Selling US Products and Services
There are no sectors or services where only Spanish citizens are allowed to own or sell.