Exporting to Asia: The best strategies for startups and small businesses

Since we started to publish articles related to business with Asia, “Can you tell me more about exporting to Asia?” has become one of the most common questions people address to me. Thus I asked Fredrik Grönkvist, my business partner on several project not related to this website, to write an overview on the best strategies a small business can use to start exporting its goods to Asia. He’s an expert on the topic and I find the article quite useful. Enjoy!

There’s been a lot of hype surrounding Asia as an emerging market in the last years. While large corporations such as Apple, GM and LVMH are making billions of dollars in the far East, there are rather few success stories when it comes to smaller businesses. While there may be various reasons for this, I am still convinced that small businesses in Europe and America could do a lot better. Let’s forget about over hyped macro economic data (it doesn’t relate to your business anyway) and look into this from a more practical perspective.

That is let’s look at the strategies a small business can apply for exporting its products in China or, more in general, in Asia.

Products, quality and pricing

First of all, forget about competing on price. It’s not possible to compete with suppliers in China, Cambodia and Vietnam on this factor. Not only do these countries have a huge pool of cheap labor, but due to proximity they can also offer shorter delivery times and lower shipping costs.

That being said I’ll move on to what really matters. You may have read that large companies such as H&M and Luis Vuitton have made huge profits on the Asian markets in the last decade. While this is not directly relevant to small businesses, I want to underline that the market is indeed large enough to fit more than these giants.

Possibly due to a lack of confidence and knowledge, many small businesses tend to assume that showcasing a brand is only useful when it’s already established. This is wrong. A brand, regardless of when it was established, can result in a major increase of a products value. I have a background in managing outsourced production in China and branding is a key strategy for increasing the perceived value when importing products. This is even more important when exporting products to Asia. Since you can’t compete on price, you must compete on quality and perceived value. This is why a brand is a key factor for any western company that aims at exporting to Asia.

While there’s a lot of hype about the “decline of the West” – I beg to differ, – Asian consumers are in general considering western products to be of higher quality and value than local brands (with the exception of Japanese and Korean products that also tends to be of an excellent quality). A common tactic is therefore simply to exploit the country where your products are made. “Made in Italy”
Source: http://www.saporedicina.com/english/exporting-to-asia-for-small-businesses/