Know How ASEAN Integration Can Affect Your Business

It seems that most local business-men are unaware or indifferent to the coming ASEAN (Association of Southeast Asian Nations) integration. But ignoring its impact may prove disastrous to your business while knowledge of what it is will give you more time to adapt to the evolving situation. Some are looking forward to the full effects of the integration, while there are also those against the idea.

In essence, the ASEAN integration was made with the intention to promote economic growth by expanding markets and fostering better foreign relations. The integration is a unification of the participating countries’ markets which makes trading and working in the member countries easier.

What’s in store for everyone in this integration? A lot of things, especially for businesses. Here are some of the pros and cons regarding the integration:

Pros:

Larger market. With the merging of available markets within the ASEAN region, everyone gets a fair chance of capturing a bigger flag. You can now make yourself available not only to your local consumers, but also to the massive number of foreign potential clients from neighbor countries. There is a larger pool of fish that you can gain from, which means a possibility of bigger profit.

More investors. A promising company is a promising company, no matter what country it is in. In this integration, there is a great chance that if your company is big in the local market, foreign investors can come in and invest in your company. The more investors, the more money your company can use in order to expand or improve your services.

Cons:

Fiercer competition. It’s all fun and games with the idea that there is a larger market now, until you realize that it is not as easy as before. More companies are now competing in the market, trying to capture even your own consumer base. Your strategies against local competitors won’t work as the new competitors will be bringing a different approach in the competition. Strategizing will not be easy.

Costly labor. Another competition that you will have to face in this integration is in hiring competitive people. People are now able to apply to foreign companies, which means that it will be harder for us local companies to get excellent applicants. Most of them will opt to apply to foreign firms given the currency exchange rate and the ability of foreign companies to pay more. This might push us to increase salary offers just to get quality applicants.

Given the pros and cons of the integration, we must now ask: What can we do in order to keep up with the competition?

Hone your English communication skills. English is the universal language and is the language of business. In a market that challenges the competitors with language barriers, the first step in penetrating it is by knowing how to effectively convey your message to foreign clients. English is essential for the business, its managers and even employees. Make sure that your front desks and sales team are proficient in the English language.

Go for their markets. For the bold company with the resources and capability the best defense may be offense. Instead of waiting for foreign companies to eat your market, why not see if you can expand overseas into other ASEAN countries?

Be on a par with international standards. We mentioned that the competition is stronger with all the foreign companies trying to capture a share of your local market. Some of them will be using more advanced technology and strategies, so make sure that you are ready for the competition. Start by complying with international standards (ISOs), getting certified, and joining international organizations to be updated with the latest trends in the industry. By being certified, you are giving a guarantee to potential customers that your company is utilizing the latest technology that their local suppliers might be selling, and that you are also a viable option for their purchases.

Study different cultures. Sure, your business might have been successful for how many years in the Philippine market, but how well will you do in a different country such as Malaysia or Singapore? Will they accept the same recipe and taste you use in your best-selling meal in the country? Do they like emotional ads? How do they view the acts portrayed in your commercial? A deep knowledge of the market’s culture is essential in making your strategies. There have been a lot of marketing blunders when it comes to promoting products in a different market — wrong translation, practices that are offensive to culture. Because of these barriers, it would be better if a company would choose to have different marketing slogans for different countries.

Knowing and planning for the coming ASEAN integration are essential for virtually all companies. Opportunities abound but so will competition. Being prepared is far superior to just waiting for it to happen before you react.

*Originally published by the Manila Bulletin. Manila Bulletin, C-6, Sunday, January 31, 2016. Written by Ruben Anlacan, Jr. (President, BusinessCoach, Inc.) All rights reserved. May not be reproduced or copied without express written permission of the copyright holders.