5 THINGS TO KNOW BEFORE DOING BUSINESS IN INDIA
Despite many risks of doing business India, it is one of the top destinations for foreign direct investments. Foreign direct investment (FDI) is a major source of non-debt financial resource for the economic development of India. We know that many big firms outsource their businesses to India to set up their business operations.
The main reason behind this is cheap labor and special investment privileges. Average daily wage in India was around $4 during the year 2014. So, this is the primary selling point why many foreign countries are willing to outsource or invest in India. Despite all the advantages, you need to keep in mind some important aspects before starting a business in India.
Re-canvas your Business Model
The products Indians choose is a cultural thing. The most popular selling products in your country might not be the same in India. Even if people use the product that is famous, the customer segment that uses the product might not be the same. For instance, when Kellogg came in India for the first time, it failed to sell even though the market share in the US for same product was around 40%. Consumers did not see Kellogg as a breakfast product but as a novelty and would preferred only if it tasted good. We prefer boiled vegetables and fruits instead. The brand had to directly compete with boiled vegetables and lost to it. Kellogg changed their strategy and brand placement.
Bureaucracy – An art of making the possible impossible
We love hierarchies and we respect our superiors. There will be very few instances in which we contradict our boss if not none. We don’t raise voice or speak up in a meeting but will be more open when speaking to someone in person. We should be inculcated with the culture of questioning. Once that is successful, we do have a lot to contribute.
Sometimes foreign companies are affected due to political backtracking. Be aware of bans and strikes. Expect a chaos when there is a disagreement between people and officials. There could incur potential loss. Well the good news is that India is a stable democracy and the country wouldn’t fail even in the worst case.
We are Polychronic !
“If the website of the ministry says it will take 13 weeks to get the required certificate, it is not realistic that it will take 13 weeks” said a renowned Indian Professor. Following time is not particularly our strongest point. While I say this, I also say that it is inappropriate to stereotype the whole nation based on this.
Ever heard of Indian English?
English is a little less polite compared to other languages spoken in India. Do not be surprised if people address you as sir/madam. We do not want to come across as disrespectful. Well hey, a little more respect doesn’t hurt! If you speak with an Indian you will notice that he/she doesn’t use please or thank you as much as a Westerner does. It doesn’t mean we are disrespectful. We tend to show differently: with a head nod or a smile. Speaking of English, you should also be aware that we sometimes tend to translate few phrases directly from our mother tongues. Don’t be surprised if it sounds like English but doesn’t make sense to you.