Striking out from the home market in America and creating a sales presence in Asia can be a daunting task. Your company is young. Revenues until now have come exclusively from the market you and the executive team best understands, America. It is now time to expand your revenue opportunities by launching a sales and marketing presence in Asia. Where do you start? How do you commence? The number of American companies operating in Asia lends proof that setting up a presence in Asia is not impossible. Since the executive team has no history in Asia, you wonder how to begin the process. This article is written for the company desiring to develop a sales and marketing presence in Asia, but lacking experience in the Orient.

By the time a young company establishes a presence in the USA with real sales, marketing and operations, other regions of the world start to produce enquiries. Those initial queries can, if managed properly, provide value in two fashions: First, the enquiries can transition from probing by potential customers into real sales, even without yet having a real branch overseas. Early Asian sales can be handled by American headquarters staff. Second, the opportunities can serve as a training program from which many lessons can be learned: From what countries do most enquiries originate? From which countries do the largest opportunities appear? What are the similarities and differences between the needs of the Asian and American markets?

By properly handling questions coming from overseas customers, a young company can learn quite a lot about its potential Asian market. The first order of business in the process of expanding sales and marketing into Asia is to determine which country to target first. Two questions must be asked simultaneously and the answers to those questions must be identical: First, which Pacific Rim country is most important to the company in the next two-to-four years? Second, which country can serve later as the Asian regional headquarters? If expansion into the first Asian market proves successful, migration into other Asian markets is natural. Multinational companies generally identify one capital city to serve as Asian regional headquarters.

Regional headquarters can sometimes be transitory. A young start-up company might open an Asian headquarters in Singapore or Hong Kong because of the commensurate ease of doing so and relatively minor risk. Once the regional headquarters is established and sales are flowing from several Asian markets, it may be appropriate to relocate headquarters to a country where the long-term market is largest. Relocation of Asian headquarters may be a more obvious decision once products gain increasing acceptance and a true center of marketing becomes more apparent. For many companies, China represents simultaneously the latest long-term opportunity and the country of greatest risk for a young company.

A company that lacks an understanding of which market in Asia is most important is not yet ready for Asian expansion. If selection of the first Asian market is not simple and semiautomatic, it is too early to expand. Likewise, if the country in which the Asian headquarters should be located within a few years is not yet obvious, the company should stick to its home market until the candidate country becomes more readily apparent.

Mimicking older established companies may not provide great results. The best regional headquarters in Asia for a large multinational company might not be the same for the young company looking to establish its first sales and marketing presence in Asia. A Fortune 500 company, for example, might select China for its Asian headquarters. Its has decades of sales, marketing, operating and manufacturing experience there and the Chinese market is far greater than any other in the region. A young company trying to establish a sales and marketing presence could become overwhelmed if it attempted to enter China as its first Asian market.

Submitted by contributing analyst, Glen Balzer.  He is president of New Era Consulting, www.neweraconsulting.com.