First know why your business is a success in New Zealand, says Greg Reynolds of Zedgro Asian Business Development consultants.
For many New Zealand businesses, Asia holds many attractions as new markets and for their educated workforce. But there are many pitfalls for under-prepared companies so it pays to do your homework first.
We are a fast-growing clothing company. We pride ourselves on manufacturing in New Zealand but know that we need to consider manufacturing some of our lines abroad. How do we find out which is the best market for us?
I cannot think of any Asian country which cannot point to a huge workforce with experience in clothing. Indeed, the latecomer to this area is probably Bangladesh, which suddenly has blossomed as infrastructure improvements continue to move this country ahead. One of the key decisions is where you are sourcing your material - our advice is always to try to keep everything within one country's borders if it is practical.
A note of warning, make sure you check duty rates from various countries and get accurate pricing on shipping before you make your final decision.
We think we have a product which would sell well in India. How do we introduce it with the most impact?
India is a challenging market as it is not really one country, but five distinct regions with very different cultures, right down to food and the way they do business. Internal freight costs in India are huge - we always recommend you decide which region best fits your product and start with the strongest fit.
The only entry strategy for India is through a local relationship. It is simply not possible to walk into this massive market and go it alone. So you need to find someone who is working in your market segment at the moment. Resist the urge to deal with an agent who promises the world - unless you can get connected with someone running a business that will take on your product you are unlikely to succeed. NZ Trade and Enterprise in Mumbai have been
a great help to us working with a client. Talk to your local representative - also your local Chamber of Commerce may be able to help you find the right person.
Where have you seen NZ companies go wrong in their dealings with the Asian markets you know?
Kiwis expect business to be transacted in a relatively short period of time. Many send a business development manager to Asia with a stack of business cards and 10 days to "scope the market and see what you can find out". But business people in Asia are as interested in doing background checks of Kiwis and their product or services as we are of them, which all takes time.
In addition, we find many companies hold back in initial meetings, as they are trying to work out if this is the right supplier or partner for them.
This is often interpreted that they do not really understand their own business, or worse, it is interpreted as distrust which is not a good way to start a good business relationship.
The key to successfully entering Asia is to first understand your own business success in New Zealand. Why are you successful? What is your unique selling proposition? How did you start and who were your initial customers? Who are your competitors and what are their strengths? You need to understand your local success and be able to discuss your local business strategy and marketing strategy so others can understand what you have on offer.
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Send your questions to Gill at: Southgill1@gmail.com
