Relationships crucial when going global

There has never been a better time for Australian companies to expand into Asia. Today, China is Australia’s largest trading partner for both imports and exports.

Opportunities abound, as China now has the world’s largest middle class population which leads it increasingly towards a market for high grade goods and services. For example, China is currently the biggest international market for Australia’s education industry. This trend continues across Asia, as manufacturing moves into cheaper labor markets, and the demand for quality increases. This creates a unique opportunity for Australian SMEs to expand. No longer is the move into Asia solely for large corporations with international reach.

SMEs often believe that size is essential in a market such as China, however this is not necessarily the case. Online marketing and e-payment measures have changed that.

There is much support for Australian SME’s looking to expand internationally. Organisations such as the Australian China Business Council and Austrade are committed to helping Australian companies succeed in China. There are also individual companies whose businesses are built on providing support for growing Australian companies and helping them in global markets. It is essential that Australian SMEs understand that there is no need to recreate the wheel and break into international markets on their own.

In a global market, in which Australian companies are increasingly competing, it is becoming more and more common for companies to be headquartered in Melbourne, have a factories in China and a logistics centre in Singapore; or based in Perth, with a call centre in Mumbai servicing multiple global markets. Working across time zones, cultures and IT systems isn’t free of challenges. These are just some reasons that using the correct partner is important. SMEs should only select partners that truly understand the environments in which they are operating and that can provide the support needed for SMEs to fully reach their potential in a new market.

The Chinese market, whilst lucrative, is notoriously difficult to succeed in. Many in the West understand today that China is a guanxi culture – a culture based on personal relationships. But personal relationships have to continue after the banquet dinners are over and the parties have returned home. That’s where telecommunications comes into play. Having the right partner will mean the difference between good and bad communication for beyond what guanxi allows.

Australian SMEs must ensure that they do their due diligence before venturing into Asia. This applies to everything from suppliers and distributors to picking the right telco partner. With the right partners on side, Australian SMEs can operate and excel across the global marketplace.

About the author

Erica Liu is General Manager – Australia with China Unicom, a Fortune 500  telecommunications provider with a presence in 70 countries and regions. 

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