Run To The Revenue - Part II
July 26, 2008
In our first segment, we discussed some of the key factors associated with the economic growth of Asia. We spoke in depth about the top 25 global company trends over the past 10 years, the top 50 competitive nations, and how Foreign Direct Investment (FDI) has influenced the in/out flows of money. As companies from Asia continue to penetrate the U.S. markets, so too must North American enterprises penetrate Asia. The opportunities are vast, but the task of executing a successful strategy can be even more daunting. Strategies developed by most U.S. companies, either small or large, don’t work well in Asia for two main reasons. Read more… »
Tough Times Call For Smart Measures
June 23, 2008
The growth in China in the past 10 years has been unprecedented. China is still the most popular destination for foreign manufacturing investments on the globe. In 2007 it attracted more than $80 billion in Foreign Direct Investments (FDI). The China economy continues to “over heat.” Read more… »
Internet Sourcing: Easy To Do, Hard To Control
April 23, 2008
Over the last 10 years, on-line purchasing by the general consumer has become commonplace.This trend will continue to grow at double-digit rates for the foreseeable future. Most of the products are high-quality brand names that are recognized by the public. This buying process saves money, transaction time, and allows buyers to return products for a variety of reasons at the supplier’s expense. This is all part of the doing business in America. Read more… »
Audio: II-Asia Interview On NPR
March 13, 2008
Ravi Sastry, President of International Innovations, was recently interviewed on National Public Radio in his home state of South Carolina. Listen as he discusses the company, the business environment in Asia, the emergence of China and India, and the opportunity for US companies to improve their performance by taking greater advantage of Asia.
Is China Quality An Oxymoron?
February 19, 2008
The transformation of China from rice bowl to iron bowl has been done expediently. For example, in 2000, 30% of the world’s toys came from China. Five years later, this had increased to over 75%.
China increasingly dominates manufacturing in industry after industry. Over the last decade, China exported one out of every three pairs of shoes in the world. Between 2001 and 2004, China’s auto parts exports increased from $1.3 billion to $9 billion. In 1996, China exported $20 billion worth of computers, cell phones, CD players and other electronic devices. Eight years later China exported $180 billion worth.
As the West’s craving for products from China has grown, the cost of poor quality has increased at proportional rates. In recent years, there have been a number of massive recalls of Chinese-made products, from pet foods to toys to consumer electronic goods. Read more… »
China v. India: The Battle of the Titans
December 9, 2007
As China has been the dominant low cost solution for the manufacture of consumer products, so too has India for IT and Business Process Outsourcing (BPO), especially since the burst of the technology bubble in 2001. The duality of these economies is based on the practice of many US based companies to invest in China as the manufacturing powerhouse and India as the software powerhouse.
Companies making their initial entry into Asia, or looking to expand beyond the borders of China, may find India a very compelling place for high technology investments and lower costs. On the surface, India does not necessarily look like a major economy or an attractive place for a US company to setup a manufacturing operation. India’s infrastructure is poor, its traffic is chaotic, its policies and bureaucratic processes stifle development, and it is home to rampant corruption. Read more… »
Opening A Vietnam Rep Office
November 3, 2007
The Representative Office (RO) is the most simplified structure for gaining a toehold in Vietnam. The strategy behind the RO is to make a minimum investment as you learn about the inner workings of the country, understand the costs, established a market channel, and investigate the capabilities of the people. Following are the key step required for opening an RO in Vietnam.
Establishment of the RO
To establish a representative office in Vietnam, a foreign company must apply for a license issued by the Provincial Trade Department, and complete post licensing procedures including notice of operations and obtaining a seal. Application files for establishment of the representative office must be submitted to the Provincial Trade Department. To obtain a seal, the chief representative of the representative office or its staff may be required to personally lodge the applications due to security reasons. The following documents must be submitted to the licensing authority for obtaining the License: Read more… »
4 Infrastructure Options For Vietnam
October 14, 2007
In our first segment about Vietnam, we gave you key facts about the country, including some useful comparisons between the costs of doing business in Vietnam and China. As you consider your initial infrastructure investments in Vietnam, it will be important to evaluate various options for establishing an entity there.
Depending on your objectives, each option will have advantages, disadvantages, and varying degrees of complexity. The four most common approaches for establishing an entity in Vietnam are:
- Representative Office
- Branch Office
- Joint Venture Company
- 100% Foreign Owned Company
Let’s take a look at each of these approaches in more detail. Read more… »
Vietnam: The New Low-Cost Haven
September 25, 2007
The past twenty years have seen a veritable deluge of Asian foreign investment flowing first into China and, more recently, India. The impetus for most of these investments has been the promise of lower costs for materials, manufacturing, and business processes.
Concurrent with the rapid construction of factories, offices, and labs there has been an insatiable rise in the demand for people — so much so that these two countries are now experiencing unprecedented rates of wage appreciation and employee attrition as experienced workers at all levels jump for better paying opportunities. Read more… »
10 Keys To SME Outsourcing
September 15, 2007
Lower costs in Asia are not just for large firms anymore. Products, technologies, and services have become steadily cheaper, enabling small and medium enterprises, or SMEs, to take advantage of the savings and flexibility found in Asia. This is particularly true in places where large companies have already established infrastructure and sound labor practices.
As you think about doing business in Asia, keep in mind that smaller firms face different challenges than larger ones when outsourcing or moving operations thousands of miles from home.
There are fixed costs that will add expense to smaller companies, like the cost of additional workers when shifting a job or process to Asia. For senior managers, monitoring and managing work abroad takes time away from other priorities. And problems with employee retention and work quality can destroy an operation that isn’t carefully established or supervised. Read more… »