A Few Tips for Doing Business in Asia
Recently I had an opportunity to participate in a program on Doing Business in Asia for West Legal Ed Center. During that program we discussed the following "tips" for doing business in that exciting and diverse area of the world:
1. Don’t US values into your philosophy of doing business – you will fail because we are too aggressive and direct. Always be thought, respectful and humble and take time to stop talking and just listen intently to what is being presented by prospective Asian business partners.
2. Enlist someone who understands the people and relationships. Do not imagine you understand the culture – there are levels of subtlety and depth that you are unlikely to comprehend. Ask that person to help you prepare your presentation including the choice of media and any other tools that we make it easier for your counterparts to understand.
3. Work patiently and respectfully towards achieving trust in your relationships. Be prepared for prolonged and patient negotiations, where Yes often means No, and No usually means maybe. Provide ways for your opposite number to suggest alternatives to your proposals without unnecessary conflict or a feeling of being defeated. Also be prepared for numerous trips and meetings along the way to reaching a “deal”. Once mutual trust is achieved, you will succeed.
4. Plan your meetings carefully with an insider who knows and understands the people, the relationships, and the culture. Make sure that meetings match attendees at the same level within their organizations and at a level that is appropriate to make progress toward a business relationship. Send your best people and don’t assume anything about anyone at a meeting—the quietest and least assuming person might be the one who wields the power and authority within his or her team.
5. Hire locally. Make sure that you have staffers who speak the language since customers are far more inclined to trust native language speakers.
6. Know and respect the unique requirements of each market. For example, the Japanese market in particular requires respect, patience and a third generation Japanese born citizen in the deal.
7. Know and understand the business and resource environment in the area on which you are focusing. For example, the Hong Kong corridor has loads of distribution, factories, production space, and resources; while China as a whole is an untapped market.
8. You really can’t go into every Asian market at one time and using the same entry strategy. I’ve seen it suggested that you should tier your markets into three levels: Tier #1, Australia, New Zealand, Singapore, Hong Kong, Japan (most likely to buy); Tier #2, Thailand, Philippines, China, India, Malaysia (may buy); Tier #3, Indonesia, Cambodia, Vietnam, Laos, Burma (cannot afford it).
9. When looking for customers in Tier 2 and 3 markets, focus initially on multinationals since they have much greater experience with global standards of conduct and international trade practices.
10. Build awareness through advertising prior to entering the marketplace, and make sure you hire a quality reseller/distributor for the tier #2 markets. Also, don’t forget the existence and importance of regional markets with Asian countries. China, for example, really isn’t a single market due to substantial differences between North, South, East and West and rural and urban.