January 17th, 2011
03:57 AM GMT
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Hong Kong, China (CNN) – So you have a business and you want to expand into the thriving markets of Asia.  How do you start?

There's no one cookie-cutter model, but American business owner Robert Esser can draw from his own experience. After living in Asia for more than 20 years, he's overseeing the franchise expansion of Pantry Magic, a specialty cookware shop that he founded in 2006 with three other investors in Hong Kong.

Here are some key points to successfully bringing a new business to Asia:

Esser's first piece of advice: Break the region down.

“Asia looks like a market with half a billion people outside of China. The reality is it’s 10 or 15 smaller markets. Each one of those markets has, let's say, 40-50 million people in it. But out of that 40-50 million ... there really may only be 10-15 percent of population of those countries would really be your target consumer for what it is you’re selling.”

Then there is the issue of licensing and branding. Before getting the business off the ground, Esser spent about US$20,000 registering the store's trademark and drawing up the franchise agreement under Hong Kong laws. When Pantry Magic started to sell franchises in other countries, the company had to pay $2000 to $5000 for trademarks in each country.

All of the steps can be overwhelming so Charles Riotto, the president of International Licensing Industry Merchandisers' Association, says find a local partner who understands your product and the local laws.

Local partners are sometimes joint investors in the company, so they've got something at stake; however, Riotto says that's not always necessary.   "Most of the licensing deals are done by royalty that's paid for the amount of business that’s done. So one way or another, that local partner is going to have a vested interest in making sure that property or program is successful."

Riotto also adds that marketing and research is different in Asia. For example, a new cartoon character may be tested directly before youngsters at malls and schools rather than a mass marketing campaign.

“So they’re really generating interest with the younger children at an early level and really going out directly to them," Riotto said. "It’s effective especially with brands coming in from the outside because there are restrictions here (with) the amount of hours of TV programming so it’s not always easy for a character from the outside to get that TV access.”

What works in one country may not work in another. Kriengsak Sornpaisarn, the creator of a Thai animated character called G Babe, has taken his character directly to the Thai consumer. He puts the little gorilla character on gift items and promotional bags. He's even teamed up with a local cooking oil company to attach a G Babe stuffed animal to each bottle of cooking oil. Sornpaisarn says his company did 10 million baht ($US 328,000) in sales last year.

With 95 percent of his customers in Thailand, Sornpaisarn is ready to expand his business outside the country. He's looking for a licensing agent and recently bought a booth at the recent Licensing Show in Hong Kong.  "It's not easy to market by ourselves. We don't know every country's culture. Each country like Japan, Korea, the U.S. has their own taste."

soundoff (12 Responses)
  1. china

    muy bueno

    January 17, 2011 at 5:21 am |
  2. ellen

    yes, I totally agree with it.

    January 17, 2011 at 7:00 am |
  3. THomas mathews

    It's me or CNN has a problem dealing with India.There is 500 million + strong middle class,biggest in the world. Cnn always try to cut India, from the asia map and rant China.

    January 17, 2011 at 7:02 am |
  4. Luthern

    India is corrupt,, and w lot of red tape. They have IT industry. anything else has red tape all ova.

    January 17, 2011 at 8:22 am |
  5. fanta

    Indians are weird and difficult to do business with, not to mention argumentive and inflexible !

    January 17, 2011 at 8:23 am |
  6. Jets

    500M+ middle class in India... whoa is this factual or bloated details?! or maybe you are the one who is envious of China's progress?!...And mind you CNN is talking about spending markets, not just stagnant one...

    January 17, 2011 at 8:57 am |
  7. whosyourdaddy

    500 million + middle class in India?? Whats the definition of middle class again?

    January 17, 2011 at 9:47 am |
  8. !

    We should take advantages ofny business opporunity that may arise no matter in India or China. However things like trust, understanding , flexiblities can be a problem to slower the business especially if the businessman has no awareness or understanding of the culture that he is about start his business in.

    January 17, 2011 at 10:22 am |
  9. THomas mathews

    american arrogrance will never end? Thats why your master Chinesse overpower you.Hope for the Best !!!!!!!!!!!!!!!

    January 17, 2011 at 12:00 pm |
  10. Manuel Vilhena

    Very interesting. 10 to 15 markets in Asia, It seems to me that there are much more than that. Good luck for the entreperneurs.

    January 17, 2011 at 5:18 pm |
  11. Dave Witts

    I think you'll find he means mature markets... yes there are many more but not all of them subscribe to the WTO and therefore are more difficult to access.

    January 18, 2011 at 5:55 am |
  12. Ian

    If anyone needs cross culture design, branding and visual communications that bridge between usa and eu and Asia, we should be on your radar -www.nameandname.com

    August 22, 2013 at 7:07 am |

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