Expanding your Business; considering a pivot to ASEAN?
You already have a highly successful business and are now looking East to Asia. It makes a lot of sense, with 60% of the world’s population and a consumer market of some four billion people.
ASEAN is vast, comprising ten Southeast Asian countries: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. Southeast Asia is clearly not homogenous, so you may want to target your market entry carefully. One obvious choice is Malaysia.
With an office in Singapore, the major business hub for all Southeast Asia / ASEAN, YourBoard can help you successfully expand into the region. Having this Singapore presence is not only critical, but gives our clients direct Malaysia access, as well as full Southeast Asia reach.
While each expansion strategy carries its own risks, there are three M&A success strategies that should help guide your thinking.
Understand the Potential Opportunity
Asia is different, with different rules and different market characteristics. Differences exist not just between countries, but also within countries, particularly in Malaysia and Indonesia. The importance of defining business strategies by using market reports; analyses on demographics and product sell strategies; the ability to deploy the right level of organisational capability, through a talented local workforce; and working with people with local knowledge are all critical for successful Malaysia or wider Southeast Asian expansion.
Bridge the Cultural Divide
If your business expansion involves a merger or acquisition, instead of partnering, then beware! M&A deals have a notorious rate of failure, close to 90%. This is not the risk of striking the right deal, but the risk of being able to capture the synergies through the expansion strategy. People are the largest variable in the success of any M&A strategy and in Asia cultural issues can play a large, if not dominating role. Local cultures in some of the Southeast Asian markets may not exhibit the same receptiveness to what you have done elsewhere, and this again requires planning upfront to avoid the pitfalls later.
Don’t Go it Alone
The key to any successful expansion, is having a team of local experts in-country who understand the market and can facilitate the forging of local partnerships. Having the right team of experts to help you navigate your expansion journey will be the key to its success. Having a team of experts and partners to provide your business with hands-on personal support and expert advice is invaluable for a small or medium-sized business that has taken the risky step of expansion.
Once the expansion / M&A strategy has proved successful, your business model will need the inevitable flexibility and adaptability to change. Once again, having access to expert advice across a multi-disciplined team is equally critical to ensuring the business strategy for expansion continues to evolve in the way envisaged.
For M&A and expansion strategies, having a trusted partner is critical to success, as managing initial M&A strategy risks is only the beginning of a successful business expansion strategy. Having continued access to a team of multi-disciplined experts as you look to create shareholder value from an expansion, is important.
At YourBoard we take immense pride in building strong relationships with our clients; and by offering a very different approach to traditional Management Consulting firms, means that we can offer business solutions that would not normally be available to smaller and medium-sized businesses. To better understand why we differ from traditional Management Consulting firms, contact YourBoard and speak to one of our Principal Partners.
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