Are you exploiting the opportunities in Asia?
DR. KLIPPE Consult shows you why you should not only be active in Europe. Read why it can be worth it for you too to look towards Asia.
1. The markets of tomorrow are not developing in Europe
The following has already been described in other comments. It cannot be mentioned enough though as it is one of the essential core statements: the living standards in Western Europe are among the highest in the world. This is still the case, although this standard is unsustainable by traditional means. It is becoming more and more difficult for the successes of yesterday to be repeated again today. Barely 500 million people live in Europe, whilst in Asia there are already 3 billion. The average age of a German is 43 years old whilst the average age of a Vietnamese, Filipino or Malaysian is only around 24 years. In comparison with an ageing European society Asia has a very young population on the lookout for growth and prosperity. Germany and Europe have the products for this!
2. Decline in sales in Europe, growth markets in Asia
What do you think: where will more cars probably be sold? Where will the food sector expand, including the food processing and packaging areas? Where will the semi-conductors and electrical products of the future be manufactured? In Europe or in Asia?
ASEAN 2015 will be the largest free trade area in the world with 3 billion inhabitants and consumers. The cooperation between China, India, Japan, Korea and the 10 ASEAN countries will set a new standard in economic power. Any Europeans wishing to "join the game" must ensure they position themselves in good time. In plain language that means you have to be there. It does not mean though that you should give everything up here in Europe.
3. SMEs are the treasure trove of the European economy
Small and medium-sized enterprises (SMEs) are the pillars of the local economy. Outstanding products can often be found. The big players and also the hidden champions have long been operating in Asia. But other companies, those that may not yet be at the forefront, also have an excellent opportunity. They just must not let themselves become discouraged.
It is wrong to state that you have to be "big". "Being big" also means "having big costs". It is precisely the smaller company that can find it easier to gain a foothold abroad. SMEs are more flexible and are in a better position to adjust to the constantly changing conditions. Even the high costs of sales and marketing can be managed by joining forces with other companies, likeminded enterprises or strong partners. Ask yourself: don't you also want to be one of the hidden champions?
4. This is how jobs can be secured in Europe
If production is relocated abroad then domestic jobs will of course disappear. We're quite deliberately not talking about relocation driven by results here, but rather relocation determined for reasons of cost and for securing the future. Existing jobs are often thus first secured before new and different jobs are created. This process won't be stopped. Through activities abroad and particularly in Asia you gain an impression of the lifestyle, working environment, manners and markets there. You need to know all of these if you want to be successful in these countries over the long term. These impressions can lead to new ideas for your company. You can for example organize your working processes differently and that way become more effective. This in turn secures the jobs at home.
5. Take the first step (and then fly to Asia)
Do you only know the Great Wall of China or the local Chinese restaurant around the corner? In that case it's time to act. But wait, don't book your trip just yet. Now is the time to keep a level head. First of all you have to clarify your aim. It certainly won't be the desire for increased turnover or profit. Quantify your intentions. This can be compared to change management. If you are aware of your specific intentions then you have already taken the first step.
6. How do I find business partners in Asia?
Your efforts should not begin with a sign displayed at the trade fair saying "Agent required". Of course by the end of the day you will have plenty of business cards of interested candidates. They will all have the best contacts and be professionally qualified. That's what they’ll say anyway. What criteria do you use to select your candidates now? Is this how you would recruit an employee back at home? Remember that the foreign "stranger" is supposed to be your trusted confidant for a region that is alien to you. It's often about high sales figures and not insignificant costs. If you are going to play roulette then you should go to a casino.
Be honest: have you already asked what will happen if by chance a potential buyer should appear at the fair? How then do you secure support following the fair? E-mails, faxes and telephone calls from Europe are not the answer. Asians don't like that; instead they want a longer and above all a personal business relationship. This must first be established through numerous trips and considerable time spent in the country. That is unless you have found a suitable partner.
How do I approach these types of markets? How do I establish a successful sales organization? How do I find business partners? When should I go to trade fairs abroad? And how should I behave there? What do I do if someone wants to do business with me there? Just remain steady and keep your nerve: "Step by step". The motto goes: before you spend money on an air ticket, your strategy should be in place and your company goals regarding activities abroad should be clearly defined.
7. Your partner and ally
Everything can start after you have found the right business partner. Be mindful of the need for regular training sessions and personal contacts. Organization of mutual dealings with each other is also part of this. And review activities. But be careful: what is described here in a few lines means weeks and months of work within your company. But then with a good sales and marketing concept there is nothing to stop success in Asia.
8. "Your path to Asia" – conclusion
The Asian region offers unique opportunities for European SMEs through the number of its inhabitants, continuous growth, as well as the eagerness of its people to share in prosperity.
© DR. KLIPPE Consult 2010