Background and aims

The company was looking to establish a trade in Asia to capitalise upon the growing demands for IT and business services in their market sector. Some trade had been established from the UK office with support from the UK, but this was not being seen as a serious commitment to the Asia-Pacific marketplace. As a result a business survey was undertaken, including potential client visits, and the formation of a regional office and subsidiary offices throughout the region was undertaken with appropriate business plans being written.

Description

Initial research was undertaken firstly with the senior management group within the international division to establish the wants and aims of the Asia-Pacific operation. This was followed by local research within Europe with the international divisions of the potential client companies after which visits were made to the local operations of these client companies in Japan, Korea, Hong Kong, Taiwan, Malaysia and Singapore. Initial work was done looking for a JV partner and with the help of the local partner a provisional business plan was written and presented. Upon acceptance of the initial business plan, a 4 month window was established to gain the initial local contracts for the services of the company, during which time the establishment of the registered local company was made in Singapore, and the foundation of the regional office out of Singapore was made. Singapore was chosen over Hong Kong due to cost, and over Sydney and Tokyo due to proximity to the region, the latter two being too far removed to be effective regional centres. The initial phase took the company to a trading position in 10 countries in the region.

Results

The initial business plan needed revising once the local businesses were established to take into account for local cultural and language issues, buying patterns and also technological and managerial requirements. Also it was decided to mitigate risk through the use of a local JV partner, and the one chosen was a large Asia based distributor. However this business start-up in 8 countries simultaneously with a regional centre in Singapore proved to be a successful stand alone business and the company was in a break even trading position after 3 trading years, 2 years ahead of the business plan, despite a market economic down turn. In addition further time and plans were spent on investigating the Japanese market, and initial business plans and strategy formulated.

The countries included Singapore, Malaysia, Thailand, Indonesia, Philippines, Taiwan, Korea, Hong Kong, Japan and support for Australia, an already established, but poorly performing, business.

The project took 3 years from concept to first year trading position.

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