This is a market that should not be jumped into without a lot of self education, study, and observation. Read about the failures, but do it to learn how to avoid the obstacles. The Russian market still represents potentially one of the greatest business opportunities in the world today. The country has a huge supply of raw materials and products for markets outside Russia. Additionally there remains an enormous demand in the domestic consumer market for imported goods and Russia’s industrial infrastructure stands in need of significant Western upgrade if funds can be found.
Foreign media often portray Russia as a wild region with a high level of crimes and complete instability. But the experience of numerous entrepreneurs and multinational companies in Russia such as McDonalds, Procter and Gamble, British Petroleum etc proves that companies with a strong presence in the market are making profits which are often much higher than in Western Europe or in the USA.
Visit Russia and spend some time just observing, wandering around, and talking to prosperous businesses. Look at what is being sold, how it is being sold and advertised. Find some other Western business people to talk to while there, and learn what you can from them. Often these people can also suggest some experienced and reliable Russian speaking assistants or agents who can help you get your foot in the door. A Trade Tour can often be useful for some people, but don’t expect miracles, and don’t sign up for anything during the trip. Just observe and ask lots of questions. Initially, this observation time should be the only investment you make.
There are problems in Russia, very real problems, but there is no need to let these difficulties deter you from doing some business there. If a particular opportunity appears to have too many problems, don’t get involved.
The best business deals will come from a Russian company that has recognized what it wants, has scoped out the market, knows what typical prices are, has some knowledge of doing business with the West, recognizes that it must support itself with sales, not investments, knows how to present a proper business plan, can address Western accounting practices if necessary, and has something either to sell or buy that is useful to you. These companies do exist, by the hundreds, but it may take some time to find them.
Find a Russian partner through reliable sources. Turn to a market research agency to get information about your market size, long and short-term forecasts, key competitors, consumer preferences and so on. Find proper legal services, which arrange all legal issues concerning your operations in Russia. A key factor here is to choose the right route to Russian market: through a separate Russian entity recognized under Russian law; through a representative office; through strategic partnerships; or through a combination of the above; Look for opportunities to acquire real assets. The tighter Russian job market also means it is a buyer’s market for companies looking to hire well-qualified, bi-lingual or trilingual Russian professionals who often already possess Western business experience.
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