the practical toolkit for doing business in south east asia

The Practical Toolkit for Doing Business in South East Asia

Thursday 18th October

The Kia Oval

rbs.co.uk/international

Connecting your business to Asia Banking Advice & Help

18 October, The Kia Oval, London.

3rbs.co.uk

Agenda

• Introduction

• Concerns and Challenges

• Mitigating Risk

• Trade Cycle and Working Capital

• How can RBS/Natwest help?

• Innovations designed to help International trading businesses

• Government Schemes for Exporters

• Q&A

3

rbs.co.uk/international4

Potential Challenges for companies trading internationally• Time

• Distance

• Local business customs and practices

• Ease and effectiveness of communication

• Ability of the trading parties to meet their obligations

• Trust

• ‘Plan B’ if something goes wrong?

• Logistics

• Insurance

• Risks and risk management

• Getting Paid

Common Business Needs

Risk Mitigation

Finance Cash

Concerns and Challenges


Mitigating Risk

Exporter Importer

Mitigating Risk

6rbs.co.uk

Trade Cycle and Working Capital

6

Trade Cycle and Working Capital

7rbs.co.uk

What support can a banking partner provide?

• Understanding a Businesses Trade Cycle• Trade Products• Trade Finance – to match the Trade Cycle and Working Capital need• New forms of finance – UKEF supported facilities• Accounts domiciled in Asia in local currency• Access to various international payment mechanisms• Visibility and electronic delivery

Working Capital Managing Risk

How can RBS/Natwest help?

Developing the right solutions

8rbs.co.uk

RBS / Natwest can help

8

Long History in Asia

We are present in 10 countries in the region, employing over 7,500 staff and servicing over 75,000 accounts.

Global Presence

Partner banks

Branch/representative office; cash, clearing and trade capabilities

Partner banks


Partner banks


• RBS is currently ranked among the top 10 foreign banks in Asia

• We have 2,000 Electronic Channel Clients and process more than 100,000 transactions per day

• We process more than 8 million cheques and issue over 23,000 Letters of Credit per year in the region

• Our Client Service is rated as one of the Best in Asia by our clients

• Our local banking presence combined with our broad product capabilities and award-winning delivery channels have resulted in strong client relationships

How can RBS/Natwest help?

9rbs.co.uk

Helpful solutions and guidance for exporters/importers

Rob Keller


Help with getting paid on time• Debt collection service for open account trading in partnership with Atradius

• 19 offices worldwide covering 40 countries

• Nil cost to register for service

• Upfront cost for each debt of £50-£100

• Success fee of between 4 & 30%

Innovations designed to help International trading businesses

A helping hand for Exporters

• Creation of exporter’s documents - Invoices, Packing lists, Certificate of origin

• Assistance in preparation of 3rd party documents (Insurance Certs, Bills of Lading, etc)

• Follow-up with third party document providers


Investing in your business – importing machinery• Secure the machinery without having to pay up-front

• Minimises risks of international trade via Letter of Credit

• One stop shop: Asset Finance automatically pays the Import Letter of Credit facility

• Budget with certainty: a payment structure tailored to the business’ needs

Innovations designed to help International trading businesses

• Risk sharing between the banks and the government (up to 90%)

• Most popular schemes: Bond Support Scheme & Export Working Capital Scheme

• Conditions: 20% UK originated & exports to non-OECD countries

• Speak to us or UK Export Finance at an early stage

Helping businesses secure export funding


Help & Guidance

• Local experts & an ‘International’ Hotline 0800 210 0235

• Guide to International Trade

• Internet (Education & tools):

www.natwest.com/international

www.rbs.co.uk/international

Government Schemes for Exporters

http://www.natwest.com/international

http://www.rbs.co.uk/international



The Kia Oval

14Business | Individual | Not for Profit www.taylorvinters.comBusiness | Individual | Not for Profit www.taylorvinters.com

LEGAL GUIDANCE

UKABC, UKTI & RBS 18 October 2012

15www.taylorvinters.com

LAWYERS WITH A

CAMBRIDGE ATTITUDE

Business | Individual | Not for ProfitBusiness | Individual | Not for Profit www.taylorvinters.com

Our story Environment Set-up

Tax

Networking

Funding

Future

Launching

Doing deals

Talent

Taylor Vinters LLP:•Cambridge, London and

Singapore•Technology, investment

and private wealth•Focus on hi-growth tech companies and MNCs in

SE Asia•In Singapore 3 years

•Opened full-time office 2011Me:

•Technology lawyer•International practice•Strategic leadership

Taylor Vinters LLP:•Cambridge, London and

Singapore•Technology, investment

and private wealth•Focus on hi-growth tech companies and MNCs in

SE Asia•In Singapore 3 years

•Opened full-time office 2011Me:

•Technology lawyer•International practice•Strategic leadership


LAWYERS WITH A

CAMBRIDGE ATTITUDE



Tax

Networking

Funding

Future

Launching

Doing deals

Talent

• Legal systems• IP protection• Governance

and stability• Approach to

contracting• Attitude to rule

of law• Reality of enforceability

• Legal systems• IP protection• Governance

and stability• Approach to

contracting• Attitude to rule

of law• Reality of enforceability


LAWYERS WITH A

CAMBRIDGE ATTITUDE



Tax

Networking

Funding

Future

Launching

Doing deals

Talent

• Soft or hard landing?• Documenting

partnerships• Corruption and

bribery compliance• Transparency & ease

of set up• Immigration

• Regulated sectors need extra care

• Issues arise on transition

• Plan for evolution of your business

structure

• Soft or hard landing?• Documenting

partnerships• Corruption and

bribery compliance• Transparency & ease

of set up• Immigration

• Regulated sectors need extra care

• Issues arise on transition

• Plan for evolution of your business

structure


LAWYERS WITH A

CAMBRIDGE ATTITUDE



LAWYERS WITH A

CAMBRIDGE ATTITUDE



Tax

Networking

Funding

Future

Launching

Doing deals

Talent

• Key driver in choice of location• Regime and

incentives are equally important

• Corporation tax rates

• R&D tax relief• Personal tax rates

• Treatment of dividends & capital

gains• Withholding tax• Double taxation

treaties

• Key driver in choice of location• Regime and

incentives are equally important

• Corporation tax rates

• R&D tax relief• Personal tax rates

• Treatment of dividends & capital

gains• Withholding tax• Double taxation

treaties


LAWYERS WITH A

CAMBRIDGE ATTITUDE



LAWYERS WITH A

CAMBRIDGE ATTITUDE



Tax

Networking

Funding

Future

Launching

Doing deals

Talent

• World-class networking cities

• Britcham• Amcham

• Eurocham• Business development

culture• Centres for conference

activity• Transport hubs

• World-class networking cities

• Britcham• Amcham

• Eurocham• Business development

culture• Centres for conference

activity• Transport hubs


LAWYERS WITH A

CAMBRIDGE ATTITUDE



Tax

Networking

Funding

Future

Launching

Doing deals

Talent

• Private vs public funding• Smaller-name investment

funds and angels• Government remains a

major source of funding• Check industrial policy

• Legally complex

• Private vs public funding• Smaller-name investment

funds and angels• Government remains a

major source of funding• Check industrial policy

• Legally complex


LAWYERS WITH A

CAMBRIDGE ATTITUDE



Tax

Networking

Funding

Future

Launching

Doing deals

Talent

• Hard or soft landing?• Due diligence and

documentation• Service vs Product

businesses• Commitment

• Brand and credibility vital

• Relationships will take time

• Local partners/employees

important• Regional strategy

• Hard or soft landing?• Due diligence and

documentation• Service vs Product

businesses• Commitment

• Brand and credibility vital

• Relationships will take time

• Local partners/employees

important• Regional strategy


LAWYERS WITH A

CAMBRIDGE ATTITUDE



Tax

Networking

Funding

Future

Launching

Doing deals

Talent

• Expat vs local?• Immigration

• Check where you sit with industrial

policy• Brand and credibility vital to

recruitment• Light-weight

employment protection

• Churn issues• Reward and

remuneration• Expat tax

• Expat vs local?• Immigration

• Check where you sit with industrial

policy• Brand and credibility vital to

recruitment• Light-weight

employment protection

• Churn issues• Reward and

remuneration• Expat tax


LAWYERS WITH A

CAMBRIDGE ATTITUDE



Tax

Networking

Funding

Future

Launching

Doing deals

Talent

• Generally a highly sophisticated market• Process more

important than contract

• Discipline• Take care with

negotiation style• Anticipate face to

face negotiation• Use of intermediaries

• Some specialised areas may require you to educate the

market

• Generally a highly sophisticated market• Process more

important than contract

• Discipline• Take care with

negotiation style• Anticipate face to

face negotiation• Use of intermediaries

• Some specialised areas may require you to educate the

market


LAWYERS WITH A

CAMBRIDGE ATTITUDE



Tax

Networking

Funding

Future

Launching

Doing deals

Talent

• Emerging markets building legal infrastructure

• Improvements in IP protection and enforcement

• Polarisation of choice of law

• Singapore and HK will dominate dispute

forum• Shift away from trade

protectionism• Move towards

tightening of immigration rules

• Emerging markets building legal infrastructure

• Improvements in IP protection and enforcement

• Polarisation of choice of law

• Singapore and HK will dominate dispute

forum• Shift away from trade

protectionism• Move towards

tightening of immigration rules



The Kia Oval

Doing Business in Southeast AsiaStrategic Planning and Risk Assessment

Chris Torrens

Southeast Asia – risk environment

1

Divergent political, regulatory and legal systems

Mix of resource, manufacturing and service economies

Unified by FDI-fuelled growth Big Brother China is watching –

strategic importance

Macro to micro: risks in Southeast Asia

1

Event risk

Human Capital risk

Corporate risk

Sector risk

Country risk

Transnational risk Exposure to international regulation (e.g. FCPA) Risks at export destination Embargoes and sanctions

Political risk Operational risk Regulatory risk

Sector-specific regulatory risk Appropriation risk Operational risk

Ownership structure Related party transactions Corporate governance

Fraud and corruption risk Political exposure Reputational risks

Natural disasters Civil and workforce unrest M&A events

Key points for foreign companies – SMEs included

• Single largest risk stems from anti-bribery legislation• Private companies as well as public ones• Passive as well as active bribery• Extra-territorial reach • Corporate failure to prevent bribery: you can’t outsource corruption, and ignorance

is no defence

• Remember:• Know your partner/customer/vendor/supplier: due diligence• Tone from the top• Get your dirty washing out: listen to local manager problems• Create and maintain code of conduct/business integrity principles• Communicate policies• Create mechanisms for disclosing• Be clear on facilitation payments

Indonesia

Challenges for business •Creaking infrastructure•Persistent and entrenched corruption – business/politics nexus•Difficulty of doing business – 129 out of 183 in World Bank Index•Complex regulatory environment•Terrorism and natural disasters - though not a major concern for business•More remote regions pose greater challenges•Health risk issues

• Sector risks• Nationalist political agendas versus

business pragmatism• Reactive regulation• Licensing problems and appropriation risk

• Corporate risks• Who owns the business, really?• Is the company’s plan really aligned with

your investment? • Human capital risks

• Where’s your money and what was it used for?

• What happens if that “well-connected” company is no longer so connected?

• Reputational risk eg environmental damage

VietnamOverview•Economy dominated by inefficient state sector•Double digit inflation – Dong devalued 6 times since 2008•Opportunities:

• Export-focused manufacturing expanding• Fragmented FMCG market ripe for consolidation• Infrastructure under-invested (and dominated by Japanese

investors)

Key risks•Ongoing economic reform initiatives face political opposition•Ad-hoc approach to policy-making – economic volatility•Endemic corruption à la China

• ownership structures opaque• supply chains complex

•Legal fragility: poorly defined laws patchily enforced

Myanmar

Overview•Reforms are real and will continue – but not a smooth process•Significant questions over political sustainability, especially 2015•Economic reform complex and difficult – managing expectations•Hard and soft infrastructure severely lacking•New foreign investment law will help – but it remains a highly-challenging business environment

Key risks•Under-developed foreign investment environment•Opaque ownership structures – links to leadership•Fraud and malpractice widespread•Investor enthusiasm far ahead of reality – political, operational and infrastructure challenges remain

1

Associated parties: spotting red flags

Wants to be paid offshore Lacks appropriate professional qualifications or

experience Recommended by the government official with

whom you’re negotiating Close personal links with politicians, officials Asks for extra payment for ‘special services’ Promises services that are ‘impossible’ Damaging press reports or questionable

reputation in the market place Seems to be in financial difficulties

Thank you

[email protected]

+44 7595 966 970

mailto:[email protected]



The Kia Oval

The University of Nottingham Social and Cultural Understanding

The practical toolkit for setting-up business in South East Asia

Truly Global University

•4 UK Campuses; 2 international Campuses•First UK University to establish in Malaysia (2003) and China (2006)•42,000 students -One of the largest internationalstudent communities

•4,800 in Malaysia •5,500 in China •9,000 international students in the UK

Importance of Social and Cultural Understanding - Our experience

•Develops our specific local knowledge in each South East Asian country•Helps us engage appropriately with existing and aspiring students•Improves and enhances the ‘The Nottingham Experience’ •Enhances our relationship building with decision makers, institutions and individuals•Promotes effective communication at all levels•Improves business etiquette when working with industry

Respecting religious and cultural traditions

Importance of pre-departure research•Respecting religious observances e.g. Ramadan•Know key festival and holiday dates e.g. Lunar New Year; National Days•Respect and use titles e.g. Tan Sri; Dato’•Drink and dietary obligations•Personal greetings

Successful Meetings

•Research attendees and identify most senior person•Ensure ‘like for like’ seniority•Gifts-small and generally wrapped•Prepare business cards with as much detail as possible including academic titles•Expect informalities at the beginning

•Address responses to the most senior person•Calm and engaged-maintain ‘face’•Posture

•Do not push too hard for a decision

Successful Meetings (cont’d)

•Dress code-Generally business attire but expectations differ•Dinner

•See dinner as part of the meeting•Develop the relationship, bring in more personal information•Be aware of hosts dietary obligations

Importance of language•Differing levels of spoken English across SE Asian countries-find out before•What does ‘Yes’ mean?•Indirect language conveying bad news•Clarify for what is expected or required•Using Interpreters

•Professional interpreters; students•Brief and share presentation well before meeting•Clarify technical terms•Debrief after the meeting

Successful longer term business

•Engage with the right people-both key decision makers and those on a day to day basis•Role of contracts•Importance of the team•Focus on the relationship not the current problem•Spend time in the host country•Maintain contact formally and informally

Investment in social and cultural training•Constantly learning about social and cultural issues•Develop links with the host country

•Interns; Studentships•Attend events and network with visiting delegations •Spend time with your customers through visiting and hosting

Thank YouJason Feehily

Head-Asia Business [email protected]

@AsiaBusinessCtr

mailto:[email protected]



The Kia Oval

fst //

fst // www.fstthegroup.com

Brand and marketing planning for Southeast Asia

Speaker notes for UKTI practical toolkit for doing business in Southeast Asia

UKTI presentation // 2012

prepared for // practical toolkit delegates

presented by // Craig Watson

fst //


Why am I here?> Brand expert

> Broad experience of sales and marketing knowledge

> Some experience of SouthEast Asia market

fst //


Presentation focus…> The SEA market

> Brand and it’s potential role

> Defining a brand proposition

> Communicating your brand proposition / taking your brand to market

> Our experience

UKTI presentation 2012

fst //


Who are we?> fst is an integrated creative agency

> We partner our clients to deliver inspiring ideas and creative

> Established 20 years ago, fst currently employ around 50 people

> fst opened the Singapore office March 2011

fst //


What fst stands for >freespirited thinkers

fst //


Section 1

The SEA market

fst //


Plans for SouthEast Asia> What is your vision for this region?

> What countries in the region do you want to target?

> What do want to achieve?

> How are you going to get there?


fst //


Market complexities> Disparity of economies from super rich (Singapore in top 5) to very poor (Cambodia -141st out of 183 listed countries)* NB. UK ranked 22

> Resourcefulness – in this region if they can buy cheaper or do it themselves they will

> There are around 18,000 Indonesian islands, speaking 725 different languages. They do however have the 4th largest population in the world at around 238m

*World bank ranking 2005-11, Wikipedia list of countries by GDP per capitahttp://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PPP%29_per_capita

fst //


ASEAN 10> The Association of SouthEast Asian Nations comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam

> They combine to offer the world’s 4th largest single market

fst //


Research is key> Research as much as possible before you develop a marketing plan.

> UKTI very helpful with the macro support, but only you can manage the micro details required

> Shopping habits, credit card penetration, internet accessibility

> Know your market; your customers; your agent or distributors; your competitors

fst //


Intelligent Environments // 2012

Section 2Your brand

fst //


The meaning of brand> Your brand has a crucial role in realising your dream

> Much, much more than a logo

> Brand is a cluster of values and associations

> Brand encompasses imagery, design, language and behaviour to ideally deliver an emotional message

fst //


Why brand matters “when your employees understand your brand they sell your brand

when your customers engage with your brand they buy your brand

and when your competition fears your brand you win”

Richard Gray, Creative Director fst

fst //


Views from the market“Asian markets are driven by brand and relationship. Good branding is an essential component of launch – and that goes way beyond just a logo”Tim Pullan – Head of Technology & Outsourcing Asia at Taylor Vinters

“We are selling innovative and revolutionary technology to world class organisations. Thanks to fst, our new brand sends out the right message and corporate profile to our target audience. I believe this will help to play a vital part in realising our business plans in SouthEast Asia and beyond”Jerry Lee Barber – Chief Executive Officer at Optitune


fst //


Brand power Looking at it another way – A good brand can help you to:

Become Rich AND Successful

fst //


Great brands are…> simple

> relevant

> consistent

> unique

fst //



Section 3Brand proposition

fst //


What is a brand proposition?> It’s a succinct phrase or sentence that encapsulates what your brand promises…

For example:

We partner our clients to deliver inspiring ideas and creative

fst //


Why do I need one?> It’s a base on which to build your marketing plan and marcomms activity

> It’s the essence of your brand

> It’s top of your brand triangle

fst //


What is your UK brand proposition? b > What is the compelling reason for your customers to want to buy your product or service in the UK. What are your values and benefits?

> Will this work in SEA?

> Which of the following do you have or need: a brand proposition: descriptor: tag line: elevator speech


fst //



Section 4Taking your brand to market

fst //


Is your brand in shape for SEA? > What messages need to be delivered to this region?

> What marketing tools can you utilise or will have to produce?


fst //


Developing a marketing planHaving done your research you should know the following;

-which country / countries you’re starting with

- is there definitely a need for my product or service in this country?

-how and where you’re going to produce and deliver your product or service

- which elements of the marketing mix are available and relevant in the region

You are now in a position to develop your marketing plan to realise your business plan

fst //


The ‘P’s’ of marketingpBased on E. Jerome McCarthy’s 4 p’s of marketing devised in 1960, there are now a few more…b > Product > Place> Positioning > Promotion> Price > People> Passion > Planet> Profit > Profile


fst //


Considerations > Language / translation> Customer CRM / segmentation> Meanings of colours and numbers> Religious sensitivities and events> Avoid colloquialisms> Cultural differences > During Q4 of 2010, it is estimated that there were 4.02 billion search queries in China of which Baidu had a market share of 56.6%. Google who?


fst //


Numbers and Colours > The Chinese consider 8 a very lucky number> Conversely, 4 is bad – car number plates with 4’s in are avoided> The Chinese consider red to convey good fortune and joy> White is the colour associated with death and mourning in China, but symbolizes purity in Thailand and Korea


fst //


Some potentially useful brand comms tools…> A ‘local’ website> SEO, PPC and social media campaigns> Advertisement (TV, radio or trade)> A video, motion graphic or animation explaining what you do> Exhibition stand> Company brochure> Speaker events

fst //



Section 5Our experience

fst //


Launch > Visa, a valued client, presented an opportunity for us to open an office in Asia Pacific > Feasibility study and planning from September 2010> Local agent appointed December 2010 > UKTI assisted launch event, Singapore March 2011> Marketing collateral, website and business cards available for launch> Had a tactical Regis Office, Raffles Place


fst //


Progress> Moved to own dedicated office in Kampong Glam February 2012> Appointed medium weight designer 4th June 2012> SEO and networking has broadened client base from just Visa to include…Avis, Bosch, Bridgestone, Singapore Turf Club, Optitune and Transcendent. > We are recruiting 2 new members of staff


fst //


fst //


Future> To develop new website to better reflect our current proposition> To develop an international network of regional associates> To demonstrate thought leadership and educate SEA clients in the value of highly considered design and branding> To grow a work force of excellent local talent> To develop fst SEA as a stand alone integrated creative agency> To open other international offices in Middle East and USA



The Kia Oval

the practical toolkit for doing business in south east asia

Documents

trade finance

risk trade cycle

rbsnatwest help

international hotline

asia banking advice

mncs inse asia se asia

asia foreign banks

south east asia