Australian businesses may be missing opportunities to succeed in Asia, according to a new report released by PricewaterhouseCoopers (PwC).
Titled Passing us by, the report included a survey of over 1,000 Australian businesses and highlighted the lack of businesses taking advantage of the opportunities the region has to offer.
While the next 10-15 years is expected to see Asia producing half of the world’s economic output, only 9 per cent of all Australian businesses are currently operating in Asia.
“Many Australian businesses fail to appreciate that the window of opportunity to get a foothold in Asia is fast closing,” PwC Partner Andrew Parker said.
“Companies that are now successful in Asia arrived there up to 15 years ago, and they made their business plans and investments work. Along with large local businesses, they are now the competition – and they are world-class competitors.”
The report revealed Australia has a combined investment with the Association of Southeast Asian Nations (ASEAN) of $28.2 billion, nearly half what is invested in New Zealand ($45.9 billion).
12 per cent of Australia’s businesses were found to have no experience doing business in Asia; a factor Mr Parker said could change if businesses take the right opportunities.
“There are still opportunities for Australian companies to do business in Asia, if done right.” Mr Parker said.
“Australia can choose to be more than a farm or a quarry – and meet the gaps in a broad range of consumer products and services, including those that Australia does well – food, education, tourism, health and financial services.”
65 per cent of the businesses surveyed said they do not intend to change their stance towards Asia in the next 2-3 years.
“We are trading with Asia at record levels but this is a bi-lateral relationship. The results of our survey clearly show that Australian business is a long way from the level of engagement, investment and commitment needed to secure a long-term share of the region’s growth,” Mr Parker said.
The report also included the following eight tips for business success in Asia:
- Lead with strategy and take a portfolio approach
- Invest in learning the culture
- Don’t be fooled by “guanxi”
- Understand “uniquely Asian” market dynamics
- Keep timelines realistic and be patient
- Proceed with caution
- Triangulate your information
- Go easy on the integration and remember the 80/20 rules
