- February 5, 2018
- Posted by: nitin
- Category: Feed
If you haven’t yet tapped into the opportunity and potential of emerging markets, now might be a good time to start. In today’s hyper-connected, mobile, and social world, more sophisticated supply chain and fulfillment processes have opened up doors to reach new customer and partner communities. It makes significant business sense to create and scale your business to think and act globally. Apart from cost-saving factors, emerging markets have become important growth hubs, fueled by a rising middle class, increasing purchasing power, steady economic growth, and improved infrastructure.
While the opportunities in emerging markets are plentiful, there are risks to consider – which is why many businesses shy away from investing in, or exploring new emerging markets. However, it is possible to keep these risks in check, and to be successful. All it takes is 1) Knowing Your Risks, 2) Proactively Managing and Mitigating Your Risks, and 3) Being Creative.
1) Corruption, political instability, economic crises, logistics issues, or bureaucracy are some of the risks in emerging countries that can disrupt your business plans. When dealing with these risk areas, many businesses tend to assume that the risk management practices applied in one emerging market, or even in their home country, will work in another market. Nothing could be further from the truth. Even though emerging markets are often grouped together as a homogenous entity, the risks and operating conditions in each country are very different.
2) The point is this: if you’re looking to enter another market, or if you’re already in one, it’s important to understand, as well as proactively manage and mitigate your risks. One way to do this is by conducting regular risk assessments. Talk to your partners on the ground to review information and identify any emerging risks. Don’t hesitate to ask questions – due diligence and vigilance are essential.
3) Empower your local team members who have a great understanding of the regional culture to proactively come up with ideas and best practices on how to tackle any potential risks.
Conclusion: Entering into an emerging market can be challenging. It takes perseverance, patience, and vigilance when it comes to understanding, managing, and proactively mitigating any of the associated risks. However, the long-term opportunities for your business can be significant and well worth it in terms of reaching new customers, gaining new business partners, and attracting employees that will help you grow and scale your business.