Watch out for common mistakes and be prepared
However, Danny warns against jumping in head-first: “We have seen some common mistakes, such as rushing into new business relationships too quickly, and also assuming success at home can be easily transplanted to the new market without modification and that success will follow instantly.”
“Don’t just rush into a transactional relationship with the first person you meet,” he adds.
Having lived and worked in Ho Chi Minh City, Vietnam and Shanghai, China for 10 years, Danny advises Australian businesses who are planning to trade with Asia to conduct appropriate market research and preparation before proceeding.
Meanwhile, he recommends those currently operating in Asia should use this time to strengthen existing relationships and knowledge base.
Keep in regular contact with your customers, suppliers and local staff
Maintaining close contact with relevant parties in Asia is an essential part of doing business, even more so in a cross-border context.
“Market conditions can change quickly as evidenced during COVID-19 and closely monitoring the situation can help your business adapt to the changed conditions more effectively – whether this be new consumer trends, regulatory changes or supply chain challenges,” Danny says. “Peak industry bodies can also support you with up-to-date information.”
Later, when travel is permitted, visiting the market you wish to do business in is recommended to obtain insights on the ground as well as to develop and ‘road-test’ your business model and value proposition. Investing time to visit and become familiar with local practices and networks before commencing trade is critical, according to Danny.
Review and update your business plan regularly – based on insights gathered from first-hand experience and trusted contacts in the field.
“The business plan should include ways to approach the market and the specific segments you wish to target,” he says. “It should also determine what type of business model is most suitable, for example, online presence or physical presence, and whether to partner with locals.”
Businesses should also take into account the changed environment and how to adapt, for instance a contact-less service model and how to scale up promotion and delivery again when the pandemic situation improves.
Undertake due diligence on the parties you intend to work with and assess their character, capability and capacity to ensure it aligns with your own.
Danny also urges businesses to be sensitive to other cultures: “Listen to their perspectives and observe how they do business. Clear and open communication is the key to reaching consensus and building a win-win relationship in the current climate.”
For more information about ShineWing Australia visit www.shinewing.com.au