By examining the way a large selection of UK-, EU-, US- and ANZ-based enterprises have gone about entering the Southeast Asia market for the first time, we can see that the most common approaches combine one or more of the following strategy choices:
This approach is used to minimise setup costs and to avoid the complexities of local business registration and other paperwork. The new business venture might be intended as a pilot project, or might be launched in response to demands from a single, key customer account in the target country, or perhaps in response to a fixed-term contractual engagement where renewal is optional, not guaranteed.
Although the operation may also rely on some form of local partnership with a major player, the assumption is that the venture can easily be wound up if necessary.
Actual business management is conducted by a UK office using electronic media and occasional, if at all, in-country visits. The in-country office is basically a business unit of the parent company, in all but name.
This approach is seen as a way of containing staffing and management overhead costs, and of reducing culture shock or other integration issues. Organisations can actually grow very large under this style of management.
Each of these approaches has its own distinct advantages, but each also has its own often unexpected challenges. And of course, whatever approach you take, what you really want to do is maximise opportunities and minimise risks.
The cautious ‘wait-and-see’ approaches send messages into the local market that you are not truly committed to the host country, making it difficult to attract customers, business partners, and staff. Moreover, the chances are that you will never be on site when a problem arises in the business.
The mid-range investment strategies are highly reliant on second party organizations or individuals, either in-country or in-region. It is natural to expect that these parties will pay greater attention to their own interests than to yours, yet you will be reliant on them for accurate information, analysis, forecasting, and reporting. Seconding an expatriate manager or management team into the host country might seem an ideal solution:
What could possibly go wrong? Well, first of all you might not have the people available with the right level of business experience and personal characteristics necessary to have a chance of success, and who are willing to travel half way around the world, perhaps with families, to take on such a challenging assignment. And if you do, it is an expensive option fraught with personal, family, and professional risks, which can all undermine the strategy.
Naturally you will want to minimise costs and give encouragement to local staff and partners. But you also have a fiduciary duty to protect your shareholders' interests. So:
The ideal scenario would be one where a new enterprise could:
These are exactly the benefits that Lions & Tigers delivers. We provide a highly tailored service to a select number of UK and Southeast Asian businesses. We approach each engagement on an individual basis, with our clients' interests at the heart of everything we do, while working under strict confidentiality and non-disclosure agreements.
Lions & Tigers Limited Victoria House
26 Queen Victoria St.
Reading RG1 1TG
Whatever your current level of engagement in Southeast Asia, contact us today to put our team to work for you.
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