site.btaAmerican Bulgarian Business Association President: Bulgarian Companies Can Operate in Almost All Sectors in US with Right Approach
American Bulgarian Business Association (ABBA) President Sevdalin Spasov Tuesday gave BTA an interview on the occasion of ABBA's establishment earlier in 2023. The Association’s goal is to assist small and medium-sized businesses on both sides of the ocean to enter the market and grow sustainably.
ABBA was launched in the spring and already has 15 members who are employed in various fields - IT, travel services, beverage production. Most of them are Bulgarian companies - some are already active and others want to enter the US market.
The president of ABBA on the American side is Elise Nestorov, who left for the US more than 20 years ago. Rumyana Yordanova is Executive Director. The other founding members are Diana Pazaitova, Viktor Melamed, Alex Nestor, Nevena Davidova, Nikolay Tsvetanov, Dobrina Ustun. "We are all business people and that makes us a flexible and workable association," Spasov pointed out.
He is also Bulgarian Association of Circular Textile Chair, as well as founder and CEO of M Holding. The company has about 50 second-hand textile and clothing stores in Bulgaria and Greece, and has been operating in the USA for 12 years.
"The first three years in the US were very difficult, we almost went bankrupt, but then when we were able to enter the market, things were very different. We are currently operating 13 warehouses in the US, in 12 states, we have over 2,000 locations where we collect textiles with containers on streets, malls, shopping centers, etc. After 12 years, I already feel satisfaction from working there, and I have made many contacts. That is why we decided together with Elise Nestorov to support small and medium-sized companies in their journey", explained Spasov.
The aim of the association is also to attract and support representatives of the Bulgarian diaspora in the US to return and invest in Bulgaria. "We have wonderful people who left 15-20 years ago who look back with nostalgia and less and less things keep them in America, but they are worried," Spasov noted.
According to unofficial data, Bulgarians in the US are about 200,000, the real estate market in Bulgaria can flourish even if 5% are willing to return to Bulgaria, he argued. Spasov added that this is a great opportunity to increase foreign investment because these people would invest in high-end properties.
The third main goal of the association is to actively work for the improvement of the business environment and the promotion of the rule of law in Bulgaria. Spasov stressed that this is extremely important for foreign investors who want a secure environment for doing business and first ask what it is like in Bulgaria.
What do Bulgarian companies who want to work in the US need to know?
„The US is not one country, but a federation with 50 different states. Each has its individual laws, there are restrictions on activities that cannot be carried out. This means that we have to research very well where we want to register our company because the taxation is different,“ explained Sevdalin Spasov. The association sees its role precisely in the advice it can give to companies starting out on foreign markets.
"In order to open a bank account we need to have a registered address, and in order to have a registered address we need a bank account, that is a Paragraph 22. For a small company that is a challenge," he gave an example.
Which sectors are the most attractive and fastest to develop?
Spasov pointed out that Bulgarian companies traditionally invest in the IT sector in US. "Bulgarian Innovation Hub is one of the very well-functioning organizations there. It is possible to work in almost all spheres, as long as you approach it in the right way and have the desire," the ABBA President is convinced.
The association identifies the fact that Bulgaria has no trade representatives in the world's largest economy as a serious problem. "None of the Bulgarian consulates has a trade attaché to support the business. I quote the Cross-Border Economy mid-term report of 2023 that 10,065 Bulgarians worked for American companies in Bulgaria in 2021, and only 306 Americans for Bulgarian companies in the States. Bulgaria exported USD 1.2 billion worth of goods to the US in 2021 and imported four times less. Bulgarian exports of services amounted about USD 400 million, while American exports to Bulgaria amounted about USD 300 million," Spasov noted.
He gave an example of the differences in scale with his company's operations. "We have been operating in Bulgaria and the region of Greece, Romania for almost 30 years and currently we have an annual turnover of between BGN 40-50 million. We reached the same turnover in the US in just 12 years, so in a much shorter period of time. Accordingly, the profit in the US is four times higher. What we do there with 100 people, we do here with 600. The second-hand clothes collected there are an unnecessary waste, which is a valuable raw material for us," said Spasov.