Promoted Content

Building a Business Presence in Asia, Part 1: Opening the Door

Building a Business Presence in Asia, Part 1: Opening the Door
Image credit: Shutterstock

The numbers don’t lie: the future of the world economy lies in Asia. With 60% of the world’s population spread among nearly 50 countries, it is the world’s fastest-growing economic region. According to Anoop Singh, head of the IMF’s Asia and Pacific Department, Asia’s economy will be larger than that of the United States and the European Union combined by 2030; in 20 years’ time, it will have overcome the G7 industrialized nations.

For many businesses, then, expanding into Asia is no longer an option, but a necessity. In this first of a two-part series, we will look at what needs to be considered before setting up shop in this continent of economic tigers.

One Asia, Many Asias

As the recent Euro crisis has made abundantly clear, there is no such thing as a unified Europe. If anything, cultural differences are even more pronounced across Asia. What applies in Thailand in terms of law, culture and etiquette almost certainly does not apply in Mongolia; what works in South Korea may prove counterproductive in Malaysia. And within countries, the variation may be almost as great. India, for example, is made up of 29 states and seven territories, each with its own laws, culture, traditions and, yes, cuisine.

It’s important for businesses looking to crack the Asian code to take time to research the country, province and city where they seek to locate, and to adjust their business plans accordingly. On a continent where traditional, local values continue to hold sway in a large number of areas, a “one-size-fits-all” approach to business expansion, or the unthinking application of a franchise model, may lead to disaster.

New Continent, New Models

The more innovative business models, the ones breaking down even the traditional distinction between collaborator and competitor, are leading the way in Asia. The global communications consortium Inmarsat, for example, has teamed up with some 65 collaborators in a unique way: the partners are, at the same time, co-owners, customers, technology suppliers, policy regulators and—yes—service competitors.

Inmarsat is harnessing these alliances to build Global Xpress, the first high-speed broadband network that will be available anywhere in the world, provided by a single operator. It is also expanding into aviation services in the Asia Pacific region. For Inmarsat, the key to its success in Asia is a three-pronged strategy: harnessing the continent’s remarkable technological development, combining it with Western excellence in customer service, and doing so through market models that involve all actors in innovative ways.

More than Just Elbow Grease

Managing the levers and cogs of East-West relations takes more than just elbow grease: it requires a concerted effort to be culturally and linguistically aware. A few examples from the past may prove instructive. When Kentucky Fried Chicken opened its doors in China in the 1980s, its first challenge was how to brand itself. To the amusement of many, the company inadvertently translated its famous phrase, “Finger lickin’ good,” as “Eat your fingers off.” For its part, Coca-Cola’s initial attempt to transliterate its name into Chinese came out as “Bite the wax tadpole.”

In neither of these cases did the mistakes prove fatal: both KFC and Coke are tremendously popular both in today’s China and all over Asia. And for every one foible, there are at least two stories of success: Nike sneakers swept into China with an astute television commercial featuring Olympic gold-medal hurdler Liu Xiang. L’Oréal cosmetics has made a success out of marketing to Asian women. And Apple Computers has stormed Asia by partnering with companies that are also competitors, such as Samsung and Toshiba. In Vietnam, it has teamed up with the domestic tech conglomerate FPT, which has opened Apple stores in cities all over the country. The result? Sales of iPhones are increasing faster in Vietnam than anywhere else in the world.

Valuing the Experience

Ultimately, building a business in Asia comes down to valuing the experience—for you and for the consumer. If you breeze in with your eyes on the profit, you may very well be generating obstacles that could have been avoided. However, if you enter into your new endeavor with a spirit of adventure and inquisitiveness, of curiosity and openness to your host culture, you’ll find yourself learning what is needed to do business in a way that’s simultaneously profitable, respectful and sustainable. As the Chinese philosopher Lao Tzu put it, “From wonder to wonder, existence opens.”

 

In this special “Business Well Travelled” series, Cathay Pacific explores a number of ways to make the most of your time on the road. Discover what #lifewelltravelled means to other business travelers, share your own memorable experiences, and learn about how Cathay Pacific makes business travel more enjoyable.