Different models of market entry can be more suitable for certain countries. While appointing an agent or distributor is frequently the first step, in this chapter we have selected some key markets and looked at the usual or most appropriate options for developing business. Here we look at export to India.
India is a huge market of over 1.2 billion consumers and as it is further behind China in terms of development is regarded by many UK companies as offering untapped potential. Companies often look at direct exporting and then search for agents and distributors. These may not prove successful as much is promised and not delivered particularly regarding total market coverage.
After building up some experience with visits to major cities in India, companies may well conclude that they really need a local partner to access and develop the market. In addition, import duties and supplementary taxes can add around 35% or more to the landed cost. Therefore, some local manufacture or assembly or in the case of services, delivery with locally engaged staff, may be necessary to reduce costs in a price sensitive market. These considerations may result in the setting up of a joint venture with a local company.
It should be noted that establishing a business in India can demand patience and perseverance as this is a very bureaucratic country. For 2015, The World Bank ranks India 142 out of 183 countries in their “Ease of Doing Business” index. www.doingbusiness.org