India's rapid growth and large middle class is creating opportunities for Australian exporters. But you need to regard the Indian market as being a marathon, not a sprint.
In the very near future, the world's markets will be disrupted in ways we can barely imagine, by Asia's growing economies - especially that of India which at its present rate of growth, will be adding nearly Australia's population to its economy every year.
This growth creates opportunities for Australian companies in virtually every market sector - including Information Technology, Education, Infrastructure, Retail, Tourism and Financial Services. Australian businesses are well-regarded in India, and this, together with being in Asia, does give us something of a foothold when trying to establish a presence in the Indian market.
However, transforming potential into business success requires long-term thinking, as well as an understanding of the strengths and weaknesses of Indian cities and the nation's diverse cultural fabric.
Based on our experiences of helping companies enter the Indian market, listed below are six key principles to succeeding in India.
Before even assessing your market potential, it will be helpful to consider whether you are ready to:
- Find the right local partner - Strong businesses with national distribution networks and established credibility abound in India, and deals can be initiated and concluded within hours on the strength of a handshake. However, there are also weaker enterprises looking to grow through a foreign collaborator.
With this in mind, it is important that you do not mistake enthusiasm from a potential Indian partner for the ability to deliver results. To be successful you will need to see beyond initial interactions to the strength and substance behind the partnership proposal.
- Establish local networks and relationships - When you are in India, join the local business associations such the Confederation of Commerce and Industry (CCI) and National Association of Software and Services Companies (NASSCOM), among others, to gain an understanding of how business is done in key regions.
- Embrace local management talent and invest in your employees - India is characterised by well-qualified, entrepreneurial and driven management talent who thrive in high-performing environments where hard work is rewarded with opportunities for growth.
In such an environment, employees will devote their lives to the development of their careers. Businesses that invest in creating such an environment are being rewarded with growth - while those creating dead-end jobs suffer through high staff attrition.
- Customise your product and price point for the Indian market - The Indian consumer has come of age and no longer unquestioningly accept foreign brands high price points. Indian brands today are commanding similar prestige - so beating the local players will pose a challenge - and the key to success is to find ways to deliver extra value to the increasingly savvy Indian consumer.
- Protect your IP - India is now taking a proactive role in developing IP protection laws - given that it is today a developer of IP rather than a consumer of foreign IP. However, it still makes sense to safeguard your know-how, IP and operational insights, by using an experienced advisor who can ensure exchanges are structured to protect your interests.
- Take a long-term view - The journey into India is akin to a marathon rather than a sprint. There will be enormous frustrations along the way, from overcoming bureaucracy to simply getting from one step to another. It is best to commence the process understanding, and being prepared for a long-term project.
Sound feasible? From here, the best way to start doing business in India is to hop on a plane and experience this world for yourself.
Be warned: first glimpses can make it hard to believe that India is the world's other emerging superpower. Jolting sights of extreme poverty abound even in the business capitals. A lack of subways and a dearth of expressways result in nightmarish traffic.
But visit the office towers and R&D centres sprouting everywhere, and you will see the transformation. Motorola, Hewlett-Packard, Cisco Systems and other tech giants now rely on their Indian teams to devise features for next-generation devices. Indian engineering houses use 3D computer simulations to tweak designs of everything from car engines and forklifts to aircraft wings.
Odds are that there is room for your business, too, to prosper in India - if you start out in good company, and commit to meeting the requirements and overcoming the obstacles to entering this market. That done, you will be rewarded for your effort, time and perseverance in more ways than you may anticipate.
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