As the world’s most populated country and one of its fastest-growing economies, India has caught the eye of businesses from all over the globe. It is a country where opportunities abound thanks not only to its many consumers, but its well-educated and skilled workforce. However, capitalising on India’s opportunities is not without its challenges, especially for foreign companies. Here are some entry strategies you can use to give your business the best chance of success.
Choose Your Structure Wisely
When setting up a business anywhere, the first big, hard-to-reverse decision you will make is choosing the business structure. This has tax, liability, and control implications. India offers several structures to choose from, including wholly owned subsidiaries, joint ventures, branch offices, and franchises. There are pros and cons to each which you will need to compare, and there are firms you can consult for advice to help you make the right choice, such as Acclime India.
Understand the Compliance Requirements
Again, this is not something specific to India, although India does have a fairly complex regulatory framework for foreign companies. This includes numerous sector-specific clauses and limits on how much foreign direct investment is allowed by companies in particular industries. New companies also need to register with the Ministry of Corporate Affairs and apply for any licenses they need, as well as calculate their corporate taxes and goods and services tax correctly.
Conduct Thorough Market Research
India is not just a single, homogenous market. Each Indian state has its own culture, business ecosystem, and consumer preferences. What works in one area of the country may not work in another, so it is important to do in-depth market research to figure out precisely which Indian consumer or business you are trying to target. Additionally, you should take time to research India’s infrastructure, which is of variable quality and could affect your business operations.
Team Up with Locals
It is much easier to enter the Indian market with a local partner to guide you. They can help you with everything from understanding consumer preferences to applying for licenses. Of course, they may also have connections with other local businesses that could benefit your company. Whether you formalise this partnership by opting for something like a joint venture or consult a service like Acclime India, a little local guidance can go a long way.
Hire Local Talent
Another way to get some local expertise on board is to hire it, and India has a well-educated and eager workforce for your business to benefit from. But managing a foreign workforce can be challenging, not just because of cultural differences but also because of employment laws and regulations. Some foreign businesses find it easier to outsource HR and payroll management to local firms that handle everything from hiring to monitoring employee productivity and paying salaries.
Conclusion
There are few greater growth opportunities on the planet than India, but taking advantage of them requires you to carefully think through foundational decisions, like which type of business structure you will use and which consumers, in particular, you are going to target. Making sure you are satisfied with all the items on this list will ensure that your Indian business adventure gets off on the right foot.