Market entry feasibility: is Spain worth it, and at what cost?
A study designed to produce a decision rather than a description. Demand evidence, the real cost to serve, the regulatory position and the structure required — converging on a recommendation you can take to a board.
Feasibility is the study most often commissioned and most often mis-scoped. The brief says "assess the opportunity in Spain"; what the company actually needs to know is whether entering will make money within a defined horizon, and what has to be true for that to happen.
So the study starts from the decision. What will you do differently depending on the answer? If the company is entering Spain regardless, a feasibility study is theatre and we will tell you to skip it and spend the money on execution instead. If the answer genuinely determines the commitment, then it is worth doing properly.
The four inputs.
The fourth input sits underneath all of them: the regulatory position. If the product cannot lawfully be supplied without an authorisation that takes eighteen months, the demand analysis is academic. Where the sector is regulated, feasibility and regulatory assessment are run together rather than in sequence.
Cost to serve: the number nobody calculates.
Entrants budget the setup and forget the operating base. A Spanish company is not expensive to run, but it is not free either, and the gap between "we incorporated" and "we are profitable here" is made of recurring costs that are entirely foreseeable and rarely foreseen.
| Cost line | Nature | Frequently missed because |
|---|---|---|
| Entity setup | One-off | Usually the only line that is budgeted |
| Accounting and filings | Recurring | Applies even when the company is dormant |
| Employer cost above salary | Recurring | Social security adds roughly a third on top of gross pay |
| Severance accrual | Accruing liability | Treated as an exceptional event rather than a provision |
| Payment acceptance and banking | Recurring | Local payment methods are a conversion requirement, not an option |
| Localization and support | Recurring | Native Spanish content and service hours, not a one-off translation |
| Customer acquisition | Recurring | Budgeted, but usually at home-market conversion assumptions |
| Compliance infrastructure | Recurring | Invoicing software rules, consent, data protection |
What the deliverable says.
Assumptions are visible and yours to change.
The breakeven model is delivered with its inputs exposed, not baked into a chart. If your team disagrees with our conversion assumption or our volume estimate, you change the number and watch the answer move — which is the only way a board discussion about a new market is worth having.
When a feasibility study is the wrong purchase.
The decision is already made
You are entering Spain regardless, the board has committed, or the study is being commissioned to justify a decision rather than inform one. Spend the money on execution and on getting the sequence right instead.
A no would actually change something
The commitment is real and reversible, the market is unfamiliar, the cost of a wrong entry is material, or you need a defensible basis for a board or investor decision.
Execution starts from the study, not from scratch.
The structure, sequence and timeline in the recommendation become the formation plan. Same team, same file, no re-explaining the business to a new firm.
What is the difference between this and a market size report?
Will you tell us not to enter if that is the answer?
Can you model different scenarios?
How much primary research is involved?
Do you cover entry by acquisition?
The rest of the practice.
A study that cannot say no was never a study.
Scope a study ↗Alexander Baranov
Seventeen years designing and delivering cross-border corporate structures — incorporation, tax, holding, banking and market entry — for founders and companies expanding into Spain and the EU. Author of professional books on entering the Spanish market.
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