Relocating your business: the advantages of Switzerland

Bureaucracy in Italy is leading a growing number of entrepreneurs to start thinking about Switzerland as a place to relocate their business. There are several aspects to consider. We summarise the main pros and cons of relocating a company to Ticino in this article.

There are a number of reasons to think about relocating your company: relocation can be a direct consequence of a change in company ownership, due to corporate transactions like sales, demergers, mergers, rental and leases. Or it may be a way to try and lower production and labour costs, especially when it comes to cross-border relocation. It is well known that bureaucracy in Italy is complex and that there are high taxes for entrepreneurs – so much so that they often think about relocating their business across the border.

Some of the advantages sought by those who want to relocate are cheaper labour, more lenient legislation and tax breaks. However, it is important to consider factors like following competitors and the market interest in the product or service on offer when choosing a country for relocation. If properly studied, relocation can also act as a talent magnet, attracting new suppliers and talent within the company, and increasing the number of clients as a result.

Where is a good place to relocate your business? Switzerland, and in particular the Ticino Canton, which is close to Italy in both language and culture.

The pros and cons of relocating to Switzerland

Switzerland is a perfect solution for those who want to breathe new life into their business. Here are the main benefits for relocating your business to Switzerland:

• Lower taxes than the European average
• Recognition of all proven business costs, like the company car (100% deductible over 5 years)
• An agreement between Switzerland and various European countries to avoid double taxation
• A high degree of political, economic and judicial stability (with a steadily growing GDP and a stable Swiss franc)
• Possibility of guaranteeing anonymity in the case of a private limited company (SA)
• Protection for both employers and employees: employees are protected from unfair dismissal (like in Italy), but Switzerland also protects the employer. Also the company’s social security obligations only account for 18% of gross salary
• Higher availability of skilled labour, due to the quality of work and employee protection Switzerland offers
• Bank loans: Switzerland's numerous banks, a symbol of the country, readily finance viable businesses (interest rates on loans are also currently very favourable)
• Switzerland has a strategic position at the heart of Europe, so you can assess new markets and grow your business
• The prestige and influence of a company based in Switzerland.

Despite the obvious advantages, there are also some disadvantages to consider if relocating to Switzerland:

• The quality of the labour force is high and this is also reflected in the average gross salary of Swiss employees. However, company costs for wages are much lower in Switzerland than in the rest of Europe
• Being a smaller country than Italy also means that there are smaller workspaces. The quality of infrastructure is very high, but so are rents and the purchase prices of facilities.
• Switzerland and the EU: although Switzerland is part of the Schengen area, customs duties are levied on imports and exports of goods to and from Switzerland. The exchange rate also has to be considered when doing business abroad, as Switzerland is the only country to have the franc as its currency.

It’s easy to see that when the pros and cons are weighed up, relocating your business to Switzerland is a valid option for those looking for a financially and bureaucratically stable alternative to give new life to their business.

How to avoid significant damage to your business: safe relocation

Relocating your business means not overlooking anything, as some crucial factors could impact the future of your company if not properly considered.

Advice from experts in the field can help. With specialist advice you can avoid issues like possible downtime between closing your Italian office and starting up abroad, losing your existing customer base, or costs linked to secondary activities (moving and related expenses, communications with employees and customers, etc.) negatively affecting your business.

At the NFS Group, our team of professionals has 35 years of experience. We can assess and structure your company relocation in full, according to your needs and offer an integrated business consultancy service.