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It is now the time to learn to do business with the most promising region in the world, not only given its financial strength, but because of the increase of the middle class' buying power, which translates into enormous opportunities for Colombian products.
For such purpose, PROCOLOMBIA conducted a seminar in Bogotá and Cali for entrepreneurs to learn how to conduct business in Asia.
The conferences on Japan, South Korea, China and India allowed the attendees to clear any doubts on the business culture in those markets, the complexity of the logistics system and the opportunities that have been observed.
Japan, gateway to Asia.
Japan has developed constantly, with a significant increase in its GDP per capita, reaching US$ 45,000, making it a very solid internal market.
The trends there have shown an increase in the elderly citizen population. Nowadays, people between 50 and 80 years of age make buying decisions.
PROCOLOMBIA has observed a space for natural products adapted to the elderly, organic products that provide this sector of the population with quality of life.
Thanks to this trend, the number of 24-hour-a-day convenience stores dedicated exclusively to selling these products has grown significantly.
The Japanese don't go grocery shopping every month or every fortnight. They would rather do it on a daily basis to preserve freshness, which has also triggered an increase in the number of neighborhood stores and, for the past few years now, country-of-origin labels showing the exact date and time of expiration have been very much in vogue.
This country offers opportunities especially for high value-added products. Japanese consumers are demanding and have a high payment capacity. If a product meets these characteristics, it can be sold at a price 20 times higher than the offering in the traditional markets, which offsets the challenge of shipping products to that market with a differential factor.
The opportunities identified by PROCOLOMBIA in this market are for agri-business products, preserved fruit, cocoa, confections, shrimp, pitahaya fruit, mango (in this case, with accompanying brochures to show how to consume it), bathing suits, sweat suits for teenagers and elderly citizens, plus the local fashion boutiques that are now receiving high value-added Colombian products.
India: contrasts that represent opportunities
The estimates indicate that by 2025, India will be the largest market in the world, considering that its population will surpass that of its Chinese neighbors. There are currently 160 million people who are part of the middle class sector in the country, and the 2015 estimate is 270 million, which means this sector of the population will be able to buy whatever product they want, at any price.
PROCOLOMBIA advises that the most important thing to break into this market is to consider the distinguishing factor and patience, because deals take a long time to close there.
So far, opportunities have been identified with Quinua, construction materials, ceramics, powdered soy milk, bathing suits, underwear, household articles, snacks, coffee, sauces, juice pulp, chocolate and more.
There are two other lines of business to be taken advantage of by Colombian entrepreneurs. Jewelry imports have increased 100% during the past years, as both men and women enjoy wearing these accessories. There is enormous potential for flowers, as the demand for these products continues to grow 30% annually.
All of these products may be sold at very good prices, in order to offset the expenses destined to logistics.
China looking for Mandarin-speaking products
It is very hard for any country to supply the needs of 1.5 billion people. This market has to be broken down into cities, provinces or neighborhoods that can be reached with specific products, representing 8 million, or 100 thousand consumers undoubtedly, this is great potential for any business.
Opportunities are there for any product, provided that the right strategy is designed.
PROCOLOMBIA has identified opportunities for "three-in-one coffees" (coffee, milk and sugar) and it is a market with very high potential among teenagers.
The urban growth of China and the installation of refrigerators in their local households has increased the consumption of dairy products and the tendency to buy healthier products.
There is now a growing preference for fruit-based liquor, cocktails and flavored beverages.
The confections sector, specifically in lollipops and candy, is highly attractive for Colombian businesses. Oddly enough, the largest candy consumers in China are not children, but couples who are about to be married. Giving candy is a gesture of sharing the happiness of a new union.
There has also been growth in the field of medicinal confections, taken for throat aches, cough, cold, nasal congestion and allergies.
Furthermore, there is very important space for the businesses of bathing suits and leather goods with high value-added and constant innovation.
The most important recommendation for business people is to assess the possibility of offering their products online, as this is the business channel with the highest growth in the past years.
Tips to consider regarding the business culture:
Japan:
- Punctuality: being 5 to 10 minutes early
- Business cards (Meishi)
- Email: start off with comments on the weather/season
- Decision making: lengthy process, in order to gain consensus by the entire company
- Age hierarchy is still an important aspect
India
- Punctuality: not only arriving 5 to 10 minutes early, but also consider traffic leave for the meeting one hour in advance
- Business cards: There is a lot of importance given to pronouncing names in their language of origin. Must be written in English, and having them in Hindi is viewed very well
- Start your meeting with a positive comment about India
- Interest is shown through actions. Indians cannot say no
- Decision making: not very lengthy, but only the company manager can decide
China
- It is very important to understand the region, the type of city, cultural features and income levels of the target niche
- The country is at a breakeven point where internal consumption is being heavily promoted as the motor for the national economy
- China has a growing middle-high class that is willing to buy, is open to new products and increasingly connected to the technology sector
- Success is not accomplished quickly or easily in China patience and the ability to adapt are important features that Colombian companies need to have if they are interested in this market.
