Starting a Business In Southeast Asia
Southeast Asia is potentially one of the most exciting places to begin a business, due to its young population, wide variety of skills sets within that population, such as those learned on an online MBA degree, as well as how quickly various economies within the region are growing. Places like Thailand, Vietnam and Malaysia are becoming not just Asian, but global business hubs, and to capitalize on these promising locations, it’s a good idea to plant your flag in the ground now and set up a business in these countries.
However, starting a business is easier said and done, and starting one in this region has its own set of challenges and difficulties to overcome, which sets it apart from the rest of the world. You need to have the right skills, right qualifications, as well as a good understanding of the area. This article is going to explore all the stuff you could possibly need to know to be able to start a business in Southeast Asia effectively and to grow it into a thriving business.
Why You Should Start a Business Here
There are many fantastic reasons why an individual should start a business in Southeast Asia right now. Here’s a look at some of the more pressing and biggest ones.
- Large Population
Just a year ago, the population within the countries that make up Southeast Asia was recorded to be around 662 million people, and the current population is likely to be even larger than this now that a year has passed. This number is more than double the population of the largest economy when ranked by GDP, which is the United States, demonstrating the immense potential these locations have.
A large population means that there is a high volume of people willing and ready to work, meaning that any business starting up will be incredibly likely to find talent to fill up positions and roles very quickly and easily. A larger population also suggests that there is a higher number of well-educated talents that may have obtained online MBA degrees and other qualifications, which can be very useful when starting a business. Finding the right talent for you within this large pool of individuals can be tough but can be made a lot easier by enlisting the help of recruitment agencies.
- Strong Growth Rate
In contrast to its larger population, the annual GDP of the region isn’t all that high, especially when compared to the nations that lead the way in this regard. However, a reason to be optimistic and why making the investment to start a business in this region is a good one is because it has one of the highest economy growth rates in the world.
The exact number is along the lines of 4.5% each year, which is more than double the growth rate of America, and yet again demonstrates the sheer potential that is bubbling away in this area. Of course, this growth rate is a combined average of all the nations found in Southeast Asia, so some countries will have a faster rate of growth than others and these include Cambodia, Laos and Vietnam, making these particularly good candidates as locations to start your business after attaining an online MBA.
- Highly Untapped Market
Despite the countries within Southeast Asia being categorized as one region in the same way Scandinavia and Latin America are, unlike these two examples, the cultures within the area differ drastically. Lifestyle, religions and even laws are very diverse, meaning there are huge differences between these closely clustered countries.
This cultural diversity has made it difficult for market leaders to emerge here in the same why that Amazon and Apple have in the West, meaning that there is an opportunity to become a key business in this area with relatively little top-level competition in your way. Entering a region where there is far fewer monopolies over certain industries means that there’s greater chances for a small business to grow organically over time, especially if the owner has obtained an online MBA. As a result there is the real possibility of becoming a national brand in some nations in this region.
Furthermore, as digital technology continues to grow and make its way around rural areas in this region, it means that businesses here can expect to find a growing audience base and be able to target these historically inaccessible locations.
- Low Cost of Living
An interesting aspect of living in Southeast Asia when compared to developed locations, is that the cost of living is really low. This means that budding business owners and entrepreneurs have greater opportunities to start a business without some of the financial risks that people in the United States and Europe would face.
In these developed markets, many new businesses will have to apply for funding or find an investor to be able to afford to rent space and cover running costs. In countries such as Indonesia and the Philippines, rental space is far cheaper, meaning that businesses in these locations can get started and begin to grow a lot easier. In addition, living costs in general, such as food and commuting are a lot cheaper too, meaning that business owners can afford to invest more money into their company, or spend more on educational courses, like an online MBA.
- Easy to Do Business
Many Countries within Southeast Asia rank really well in the Ease of Doing Business index, meaning that they’re locations that are perfectly suited for businesses to start up. More than half of the nations in the region rank in the top 100, due to how the governments in these places have been implementing reforms and initiatives to boost their economies.
Some of these actions include being more open to foreign businesses as well as making it easier for businesses to acquire skilled foreign talent with online MBA qualifications to improve their workforce and quality of output. This translates to an increasingly positive income outlook for businesses and individuals meaning that more people can afford to do more household spending, which means businesses can get even more money.
Some countries in Southeast Asia have some of the lowest tax rates in the world, as well as a plethora of other benefits, making it really rewarding to do business in this geographical area.
- Affordable and Hidden Talent
The average wage in Southeast Asia is far lower than in some of the more developed countries in the world, meaning that the talent you hire will be a lot cheaper, comparatively, allowing business owners to save money and spend the money saved in other areas to help boost your new business. Many young people just getting into work are also increasingly better educated than previous generations, meaning that there is a lot of great hidden talent, many of whom have obtained degrees like an online MBA as well as other types of professional qualification. This highly educated workforce can help your business provide a better service, aiding in your growth and development.
- Growing Investment Landscape
When compared to other locations, the level and frequency of investment is admittedly not that high, especially when compared to hugely attractive areas such as North California’s Silicon Valley. However, this apparent lack of investment shouldn’t put people off from starting their own business in the region. This is because the level of investment in Southeast Asia is increasing at a rapid rate, and these investors are particularly interested in start-ups in their initial years.
Over the course of last year, the number of pre-A round deals that made in southeast Asia more than doubled from 161 in the previous year to 352 in 2019. This is a very encouraging statistic and with many unicorn businesses gaining international recognition, such as Grab, Go-jek and Lazada, the interest from foreign investors with deep pockets and online MBA degrees is only set to rise, meaning that starting a business now in this region can only be a good thing as getting these more frequent investments can help accelerate your business to the next level.
Best Southeast Asian Industries to Get Into
Business is booming in pretty much all industries and professions within Southeast Asia, meaning that there really is no bad industry to start a business in, providing that you go into it with the right skills and qualifications that can be picked up from an online MBA.
However, there are certain industries that are growing at a much quicker pace than the rest, making these great areas to get into and start a business in. Here are a few industries that would make really good sense to get into in Southeast Asia.
E-commerce
The region of Southeast Asia is one place that is expected to be one of the new emerging e-commerce markets in the world, thanks to the increasing use of digital technology to reach a worldwide customer base. Many businesses within this area have experienced a boom that is comparable to what Amazon experienced in its early years, meaning that there is potential to grow into a massive brand in the future if you manage your business effectively. To help improve your own business’ chances of becoming an industry leader in e-commerce, it’s vital that you learn the skills and knowledge required, with many vital skills being attainable through an online MBA, which can be studied at home.
O2O Businesses
An O2O business is a term used to describe a company that uses an online-to-offline business model. These types of businesses are very common within all of Asia, and the volume is growing rapidly in the southeast region, making it a prime area to get started in with this form of doing business. An O2O is where a digital platform is used to make a purchase from a physical business and is beginning to turn very lucrative indeed due to the increased use of the internet and how it’s a medium where more people are doing their shopping. This is said to be ‘the new retail’ where traditional brick-and-mortar shops begin to disappear and where shopping becomes an intimate, personalized experience. Southeast Asia is an area leading in this type of business model, but there are others you can learn about in an online MBA course.
Delivery and Logistics
Many industry leaders around the world and within Southeast Asia are convinced that countries like Indonesia will become a hot delivery market. The logistics and delivery sector is set to grow in the region at an astonishing rate of 9.3 percent per year, which will help the industry reach a value of US$16.34 billion. This means that it is the perfect industry for a new business to get involved with.
Top Tips for Starting Out
Although there are many great reasons for starting a business in Southeast Asia, there are also many challenges and other things to consider when starting out. Keeping these following potential issues in mind, and by obtaining an online MBA, new business owners will be better equipped to navigate the market they’re in and increase their chances of becoming a really successful enterprise. The following is a couple of really effective tips that all business owners in the area should know.
Recruit Right to Get the Best Talent
It’s hard to get the right talent for a business in any market, however, in an area like Southeast Asia, that difficulty is increased due to how there is a massive variation in the quality of education.
This means that a business owner starting out in this area should definitely consider drawing on the help of a recruitment agency, as they’ll be better equipped to find the top-level talent. Also, these agencies will also know how to effectively navigate the employment rules and regulations, as this can get very complicated depending on the country you’re operating in and if you’re planning on hiring people from other territories.
Remember That There Are 10 Markets in Southeast Asia
With how often people combine the entirety of Southeast Asian into one entity, many people can often forget that it’s not actually a very connected region. When starting a business in one of the countries that make up the area, if you’re looking to become a big brand that grows in multiple countries in the region, it’s important to consider that there are 10 different currencies, nine official languages, varying levels of infrastructure changing from country to country, as well as 10 very different legal systems to contend with.
All these differences mean that a business leader needs to be really organized and manage these differences effectively, otherwise there will be a lot of headaches and issues. The best way to prepare yourself for opening a business in this hugely diverse region is to gain skills from an online MBA course, as this will better equip you to manage the complicated finances and legal requirements.
Southeast Asia is one of the most vibrant and diverse regions on earth, and its potential is huge. There are few locations as attractive for starting a business. And now you’re equipped with the knowledge for navigating a new business adventure in the eclectic mix of countries.
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