Post-Brexit, emerging markets such as India present enormous opportunities for UK SME’s. India is now one of the fastest growing economies in the World, with GDP growth of around 7 percent per annum and a 1.3 billion strong market of increasingly affluent consumers.
However, for outsiders doing business in India, it can seem complex, daunting and overly bureaucratic. You will therefore need to think carefully about your market entry strategy. We have outlined our 7 top tips which will help you navigate the corporate landscape.
You will need to look beyond media headlines and online reports to drill down into sub-sectors, cities and markets. Made up of 29 states and 7 union territories, there are many Indias within India. As such, detailed homework and market research visits are important to gain first hand insights and assess potential on the ground.
Choose the right entry strategy
Whether you are thinking about exporting, sourcing, manufacturing, assembling, setting up a branch office or looking at a joint venture partnership, it is vital to select the relevant entry strategy that will best suit your business and your overall objectives. You should obtain specialist professional advice on the best options for you and how you can minimise your financial, regulatory, operational and commercial exposure and risks.
You should customise your business offering to avoid a one solution fits all approach. In order to succeed, you will need to embrace the local culture, be flexible and adapt your business model to suit the local environment and consumer base. In short, you will need to learn to do business the Indian way and avoid imposing international business models and practices. Remember India is not, for practical purposes, just one market.
Pricing is key
Even with a rapidly expanding middle class in excess of 350 million, Indian consumers are highly value conscious and so your initial pricing strategy has to be assessed and pitched at the right level with realistic expectations. It is not a case of simply discounting a fixed amount from your standard UK prices and remember that haggling is important.
Invest in relationships
Although this applies across the board, India is very much a relationship orientated market and this systematic way of doing business is ingrained in the very cultural fabric of India. With that in mind, building, investing and maintaining personal relationships will pay dividends – literally!
Any sensible strategy has to allow for a realistic lead time, potentially lengthy negotiations and for establishing those trusted relationships. Given the scale of the opportunity and constant competition from global competitors, it will take time to develop your business. Once you have taken the plunge, persevere and remain committed for the long haul.
For more information, please contact Mark Blunden.