Doing Business in the Far East
Far East Asia is one of the most successful regional economies in the world. It encompasses China, the second largest global economy, even after the recent market turmoil. It also includes South East Asia, which according to the UK Trade & Investment (UKTI) has a combined GDP of £1.5 trillion in 2015.
The prosperous region is still as attractive as it was 30 years ago when Marjorie Leonidas left the United States for Hong-Kong, which was still under British Administration at the time. The managing director of retail social-proof technology Taggstar was part of a wave of entrepreneurs with the likes of Richard Caring who saw an opportunity for growth and development in Asia.
She travelled back to the 90s to share her experience and gives advice about doing business in the Far East.
After college you moved to Asia to set up your own business, why?
I studied International Business at UC Berkeley and knew from my studies and professors that the Pacific Rim as it was referred to at the time was ‘the place to go for growth’. I decided to move to Hong Kong straight out of school not having been there, I didn’t know anyone and decided not to stay home with a white picket fence. I had to get to Asia and make it happen!
What specifically attracted you to this market?
I was interested to get into Garment manufacturing and Hong Kong was the place to go for that!
You grew a business for 15 years across the Asian Pacific region, how did you do it?
I worked for one of the largest Garment Agencies in the world for four years before setting up a business for a US company called Sam & Libby. I ran their sourcing office for two and a half years before then opening up my own company Indigo HK Ltd with a Chinese investor whose family had 50 years in the denim business. I then became a key sourcing export agent for Esprit, Guess Jeans, K-Mart and many other brands. I had a team of 60 people in three countries and besides Hong Kong I opened an office in the Philippines (Manila) and Sri Lanka (Colombo).
What where the challenges of starting your business in a foreign country?
Challenges are dealing with supply chain and logistics and quality control of manufacturing in so many countries. I was manufacturing four seasons at a time in over 10 countries around the Far East. Trying to manage customers in the USA and the UK when goods were a day late out of spec could lead to air freight, discounts, cancellations. Then on top of this dealing with natural disasters such as monsoons in Bangladesh with 20 containers or yarn in the port not clearing or strikes were also fun!
How easy was it to adapt to the business etiquette? Did you have to learn the language?
It always helps to understand the local lingo, even if you’re not fluent enough to understand how to do business and be one of the locals. I studied Mandarin in university but they didn’t teach Cantonese as they speak in Hong Kong. However the Hong Kong Chinese speak perfect English. I did a lot of manufacturing in China and it helped to know some Mandarin as the mainland Chinese knew little English. Also being brave and eating new foods and being part of the culture, enjoying the traditions of Chinese new year and other important customs and holidays was part of the fun of living and working in Asia.
UKTI predicts the ASEAN region to become the 4th largest single market in 2030, what is your take on that?
There is no doubt looking at what has happened this week with the Chinese stock market crash Black Monday and the impact it has had on global markets that China is going to be a major factor in the global economy going forward. This would have been unheard of 10 years ago and shows that the rate of pace and power that China’s economy has on global affairs is going to be huge. We live in a global economy now, if China sneezes the rest of world get a cold. I remember when I was in Canton 25 years ago, there were only bicycles on the roads, now there is not a bicycle to be seen, only cars consuming vast amounts of fuel…
What would be your advice for entrepreneurs looking to expand their business into these markets?
For sure work with local partners and don’t try to be clever and do it alone. The Far East is about who you know, relationships and a lot of business is still done on handshakes…
The key to success is to understand that the East do not always think in the same way as the West and to listen, be humble, be brave, be smart but be smarter by making sure you partner with the right people who have strong connections themselves.