The Venice of the North: Why Amsterdam is the New Supply Chain Hub

The pandemic showed us that many things are not quite as they seem—especially when it comes to the economy. Many businesses were hit hard, if not fatally, and in Europe companies were additionally impacted by the new legislation that followed Brexit. 
 
We also saw the geographic status quo take a hit. Capital cities seen as powerhouses of international trade and commerce were shown to be more interchangeable in the global economy than previously believed. 
 
For logistics companies, it is necessary to take a closer look at the changes brought about by the pandemic when considering a location for an office. This is even more important for early-stage companies looking to expand into a second location. The expansion could catapult your business to new levels of growth, or cause fundamental problems if the right location isn’t chosen. 
 
Some important factors to prioritize if you’re a player in business supply and are on the hunt for your next office are; a great location in terms of accessibility, access to talent, and, last but not least, an innovative mindset. 
 
Let’s take a look at why Amsterdam ticks all of these boxes and more. 
 
Amsterdam’s geographically strategic location
 
One big contributor to Amsterdam’s status as a budding supply chain hub is its international airport, Schiphol, which handles over 95% of all Dutch air freight. What’s more, Schiphol is a fundamental part of the business sector, serving as a home to more than 500 companies and providing some 64,000 jobs. Schiphol literally means ‘main port’, and the airport serves as a hub for many other modes of transport, including cars, lorries, and trains.
 
Rotterdam Port, Europe’s largest sea port, is another reason why Amsterdam is highly favorable for logistics companies. Only a stone’s throw away from Amsterdam, the port is at the heart of the densely populated and industrialized triangle of London, Paris, and the Eastern border of Germany. Rotterdam Port lies at the mouth of two important rivers, the Rhine and the Meuse—while still open to the North Sea, the world’s most heavily navigated sea. This strategic juxtaposition amongst varying water ways helps to connect Amsterdam to the 170 million consumers who live within a 500-km radius of Amsterdam. 
 
Not only planes, boats, and trains,   Amsterdam also offers the capacity for car travel to transport goods and persons—making for an easy connection to the European mainland. This two-way ease of access to Amsterdam and the aptitude for international travel plays a vital part in the city’s ability as a business supply chain hub.
 
Benefits for companies small and large
 
Amsterdam is taking initiatives to help ignite growth for both up-and-coming businesses and individual talent within the city. 
 
The Ambitious Entrepreneurship Action Plan was created by the Dutch government, setting €75 million (about $90 million USD) aside to provide early-stage financial incubation for startups. Striving to provide better access to capital, knowledge, innovation, and the global market—this makes starting a business possible for many people with nothing but a dream. 
 
Additionally, the economic climate is very welcoming to skilled migrant workers, with an opportunity to qualify for a 30% personal tax income advantage. This makes for a diverse and highly competitive workforce, which is something that businesses both big and small can leverage. This has helped to promote a healthy and vibrant logistics ecosystem in Amsterdam—with everything from industry giants, such as the international company Flexport having one of four of their European offices in Amsterdam, to smaller more local startups such as Quicargo. 
 
These factors combined have helped Amsterdam to rank sixth worldwide as a Global Power City when it comes to attracting new businesses and talent. This ranking was based on factors such as research and development, cultural interaction, livability, environment, and accessibility.
 
A world-class innovative mindset
 
Amsterdam is quickly becoming a leading tech hub that specializes in disruptive technologies. As the city’s tech sector has developed exponentially, a large focus on ease of transportation and travel has manifested. This makes sense, as the history of international trade and logistics in the Amsterdam area goes back over 700 years with the Dutch historically famous for exploring the world in the 16th and 17th centuries. One well known modern example of this is Booking.com, which went from a small Dutch start-up to one of the world’s leading digital travel companies. 
 
Huge recent advancements in computational power and AI in general have made it possible to make revolutionary changes in the logistics industry. As international logistics is a highly complex business, we need a lot more computational power than your average post office. Another key metric in regards to these advancements is Amsterdam’s business culture and its general willingness towards trying and accepting new technologies. With many big name corporations, such as Google and Uber, embracing an open-minded spirit—the logistics industry has progressed significantly. 
 
In logistics, much more than just cutting-edge software is needed to disrupt the status quo. Rather a curiosity for improving and evolving the system will help to set businesses apart. This is only nurtured by Amsterdam ranking in as one of the world’s smartest cities, coming in fourth in a study which ranks cities across the world based on promising prospects for startups, tech, and innovation investment. 
 
All of these factors combined have helped to generate Amsterdam’s strong foothold in logistics, with over 180,000 jobs in the industry in the area. This is coupled with the Global Logistics Guide giving the Netherlands a perfect 10/10 score, and calling the country “the model for European logistics excellence,” in 2018.
 
Proximity is key in the business of logistics, and being well connected geographically, economically, and technologically allows Amsterdam to provide as a supply chain hub. For these reasons and the ones listed above, Amsterdam is one to mark on your up-and-coming business destination map.