Cost of doing business in France

Posted by admin in Business | February 25th 2009

We provide a large range of services, some of which (Houskeeping, for example) are very labour intensive. We have been asked in the past to ‘Justify’ the prices that we charge for these labour intensive services, and to that end herewith some broad information and explanations in the spirit of transparency and accountability!

Noone gets rich in France on labour intensive businesses. Not even us! 🙂

We choose to operate 100% legally and by the book, employing full time staff on CDI’s (permanent employment contracts).

A CDI offers better protection and conditions to the employee, and it affords the company more trust and confidence between us and our employees. But is is expensive, and it is less flexible to the employer than employing temp staff.

So … prices may seem high, however all of our operations are run thorugh our fully registered and bonded French company and effected by full time, permanent staff.

There are many advantages to this, and the one downfall. Price.

One can find someone to do the service cheaper, it would be disingenuous to suggest otherwise, however to do it significantly cheaper they would not be registered, taxed and otherwise within the French system.

In terms of dissecting the pricing,

The first thing is that included in prices we quote is 19.6% TVA (VAT).
Secondly, cost of labour here in France is absolutely enormous. The social charges on top of a Salary double the cost and there is direct taxation associated with simplly employing too! And working hours are shorter.

The advantages, though, are that the customer is protected in terms of liability and fiscal inspections, there is also a tax break given to people who use Company (as opposed to private individuals) whereby the cost is tax deductible on French income, and also you have the backup and support of a full organization behind you in the event that is required.

Using a private individual is often fraught with problems such as not being able to contact them, no post-clean inspections, lack of backup if (s)he is sick or decides to take a day off or any-such occurrence.

And of course legal aspects in terms of right of employment and payment of taxes, mention of which speaks for itself!

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