OVERCOMING OBSTACLES OF ENTERING THE

RUSSIAN BUSINESS ENVIRONMENT

The new emerging global business environment has focused the attention of business and manufacturing enterprises on the largely untapped potential of the Russian consumer. The road to a successful enterprise in the Russian business environment is, however, a series of obstacles—both cultural and governmental. Before proceeding to do business in Russia one must be prepared for the following steps:

Functioning in Russia

The new or existing business enterprise must first decide how it will function in Russia. Affiliate companies are subject to a lot of restrictions from accreditation, licensing and so forth — most of which must be renewed periodically as required by the government. Independent companies fare better being subject to fewer restrictions. The independent can enable a business office and staff in a relatively short amount of time allowing the beginning of business at an earlier time. A Russian professional is necessary to accomplish this step at terms most reasonable and timely to the business. It is unwise to expect to accomplish this task without professional assistance from within the country.

Marketing and Research

Generally speaking marketing and research as provided throughout the EU and the Americas will be of little value to the enterprise hoping to reach into Russia. The cost of this general information will be money not well spent. The main concern to the new business hopeful will be to get and grow distribution arms within Russia. Restrictions, requirements and difficulties associated with Russian Customs Services, and reliability of cost efficient delivery systems cause Russians to avoid directly purchasing goods from outside the country. If you do not know someone connected with the Customs Service do not hope that you can negotiate this process to a successful and profitable result. Russian distributors have the necessary contacts to eliminate this obstacle. The simple truth is that without these distributors in place no goods or services will ever reach the Russian consumer level. Make distribution contacts first.

Certification in Russia

Most Goods imported to Russia are required to get certification for conformity to Russian standards, norms and rules. The certificates have to be produced, at least, in the following three cases:

to Russian customs, when goods are imported into Russia.

to Russian authorities when goods (whole- or retail-sale) are sold on a Russian market.

to Russian authorities when a product comes to use in Russia.

This “assessment of conformity” ensures the product’s characteristics to safety requirements. Variety of the requirements arises from the existence of different sources of danger: general, hygienic and fire requirements, requirements to the medical production and building materials, radiofrequency, electrical and industrial safety requirements, etc. Certificate of conformity (sometimes is called as quality certificate or certificate) is a result of testing and assessment of testing of the product for conformity to the safety requirements, determined by standards, norms, regulations, etc. Assessment of conformity is carried out by experts of certification bodies and other special state bodies. Knowing which of the eight certificates is required for your product, and getting the testing accomplished to the satisfaction of the certifying agency, is best handled by someone with contacts in the area of certification.

Presentation in Russia

Now it is time to come to Russia to present your product line to potential customers. Make arrangements first to maximize your time. Have a professional with good contacts organize and arrange a schedule that will place you in front of the most potential buyers in the least amount of time. Identification of prospective buyers for your products is key. Everyone’s time is wasted to present products that do not conform to the buyers market sector. Furthermore, do not expect that you will get time with buyers without prior arrangement.

Another viable option is to participate in trade exhibitions. Participating in exhibitions is quite important for most companies. For some it’s a way to make new contacts and discover new technology. For others it’s a way to introduce their products and estimate their potential in a certain segment of the market. If you are familiar with the East European mentality and languages you can perhaps make these preparations yourself. If not, we suggest you allow a specialist from the host country do some, or all, of this work for you. Find someone who will:

Help to choose the exhibitions which best fit the goals of your company.

Reserve space and arrange stand construction.

Prepare for exhibition participation.

Provide travel support (hotel, transfers, etc).

Organize traffic to your booth and schedule meetings.

Provide translation-interpreter services before, during, and after exhibition.

Arrange for printing of exhibition brochures and other exhibition publications in Russia.

Post-Presentation Services

Now that you have met your buyers and arranged for distribution you need to secure these relationships through written contracts, and maintain good working relationships and efficiency of service through direct communication. Russians always prefer to speak with Russians. Be certain that you have available to you professional and reliable Russian representation for the purposes of easy communication. When in Russia do as the Russians do.

Don’t let these things prevent you from participating in the business revolution that is happening in Russia. There are buyers, distributors and consumers eager for your products. The problem is only to find them. Each of these obstacles is solvable when you engage the assistance of the right people to help you. Whenever possible it is always most efficient to try to locate a company that can successfully address all of these issues on your behalf. To take services from more than one source creates a break in continuity which is both time consuming and expensive. This is avoidable, and this should be your goal. A company that operates in both Europe and Russia will be your most efficient choice. Russia is a new participant in the global business environment. It has much to offer those who know how to avail themselves, and Russia will equally benefit from the partnerships created.

© 2009

Dr. Svetlana Mamkina
Nexus-Europe GmbH
www.nexus-gmbh.biz
email: info@nexus-gmbh.biz

Scammer Clay

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Volume 9 of the Start Your Business series focuses on proper pricing of your merchandise or services, and how to pitch your product to potential customers…. More >>

How To Start Your Business – Volume 9: Pricing and Sales

Business is a type of occupation which many like. It is an occupation which gives complete freedom to the owner. No more following of the working hours. Work at your own pace and get the desired results. Yes, there is a certain amount of risk involved but what is life without risks? So you decide to start a new business. All the plans are in place. The concept of the business is good. Your product is in place. But there is something missing. Well, actually, the main aspect of the business is missing and that is, the money. Money seems to be hard to find by. And this is because your previous record shows that you are not competent enough with money matters. Your repayment history is bad. When you go to the bank asking for loan, your records scare the branch manager. Thus, to say it short and sweet, you simply don’t have the financial backing for your business. So what do you do in such circumstances? There are quite a few steps that can be taken to get your mind back into your business. Firstly, there are three credit reporting agencies in the US namely Experian, TransUnion and Equifax. So approach all the agencies and get your credit report from all of them. Getting your credit report will help you analyze your financial situation which will make the process of solution finding for your problem a lot simpler. When doing the analysis, go through every report very carefully. Credit Bureaus make a lot of mistakes. There might be mistakes like a paid bill is market unpaid; someone else’s credit card purchase is shown in yours, etc. In case of disputes, immediately contact the agency and get the mistake rectified. In case you are unable to deal with the credit reporting agency yourself, take the help of a credit repair agency. Also, you should make a business report to solve your credit issue at a faster rate. Also, with a business report, you get a license to go ahead with your business and at the same time improve your personal FICO score. Thus, a little while after you have implemented your business report, you can apply for business credit cards and other business financing options. Next, after getting hold of business credit cards, do not use them for personal uses. Never do it. Because this will just send wrong signals to your lenders and will worsen your credit record. Plus, your accountant and your attorney will also be left guessing about the disappearance of the funds. This is particularly harmful when there is a court case going on. Thus, bad credit is not such a bad situation. Even with a bad credit you can garner enough funds to start your business. But it is very important to use these new funds properly. These funds should primarily be used for business and business only. Following good habits will go a long way in improving your credit.

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SmartStart Your Business Today! How to Start a Business in New York is your road map to avoiding operational, legal and financial pitfalls and breaking through the bureaucratic red tape that often entangles new entrepreneurs. This all-in-one resource goes a step beyond other business how-to books to give you a jump-start on planning for your business. It provides you with: Valuable state-specific sample forms and letters on CD-ROM Mailing add… More >>

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Opening an Export Business

The inception of Export business can be traced back to the time when the man had initiated business contacts with others. As the international economy developed with the influx of the information age, global trade business becomes even more significant, adventurous, thrilling and financially rewarding.

When one thinks of an Export business, they imagine massive corporations that have made their millions in global business, however various business studies have revealed that the greater part of Export businesses are dominated and managed by small and medium enterprises (SMEs).

Opening an Export business can be really profitable for you, particularly during periods of international economic fluctuations like we have now. When you are initiating an Export business your first requirement is to decide which way you would like to manage. Few of the most well-liked Export businesses are: Export Brokerage, Export Trading and Export Management Firms.

Merchant exporter: It is a set up where the individual acquires goods, and then sells them to overseas souks. This kind of export business may trade in several different items, and not just one particular product line.

Export Trading is the skill of discovering what overseas and global markets want to buy and determine the products. Then, the Individual or company organizes to export the products to the buyer.

Export Management Firm is a company that controls a business’ exports requirements. Suppose there is a firm that would like to initiate distributing their goods in the overseas zone, but they don’t familiar with how to knock into these markets. An Export Management Firm is hired to control all of the dealings. They are basically employed by the original business and are paid wages or commission for all successful dealings.

Since there are definite laws dealing with global trade and foreign business, it is very important that you should be familiar with state, federal, and international rules and regulations before initiating your export business. The best way to start is by finding with your local small business administration for preliminary details related to an export business. Your efforts on Export business can give you the real pleasure of building your own potential and doing something you really like.

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While this may have been possible many years ago, if you do this in today’s day and age, you are doing nothing more than killing your business. If you want your venture to succeed, you need to have a professional business web site that is going to not only attract new customers, but in many cases help your current clients in a number of different ways.

There is a lot that you need to know about business website development. First off, you should know that this is a job that is best left to the professionals as your site is going to be the face of your company. In other words, a lot of people are going to associate your business with the way that your web site looks. While this is a good thing if you have a professional design, it is anything but if you have skimped on the professionalism. With this in mind, you should hire a professional company to design your business website. It is a costly process, but in the long run it will pay off time and time again.

Next on the list, you need to have an idea of what your business website should do for you. As you can imagine, website development is a complex industry that offers many options. For instance, you may wish your web site to offer nothing more than basic information on what you do, where you are located, etc. But on the other hand, some companies see site development as an opportunity to offer everything from an online ordering to live chats. It is up to you to decide how far you want to take the business web site development side of things. Again, if you use a professional design company, you will be able to get everything that you need. Not to mention the fact that they will be able to help you to answer any questions that you may have.

Finally, you do need to consider price when it comes to your business website development. As mentioned above, you shouldn’t cut corners on the money side of things, but at the same time you need to make sure that you are not spending more than you have. The best way to get the best price on business web development is to obtain quotes from a number of different providers. In the end, you will be able to make a decision based on the price you have received as well as the level of service that these companies offer.

Overall, the success of your business depends greatly on the web site that you have. In order to give your business the best chance to succeed, you should think about every last detail when it comes to the development of your business website.

Are you thinking of plunging in business field? Surely you require financial support as new business involves lots of funds. You must be looking for a loan. In the UK you can avail required finance through new business loans which are specifically made for the purpose. Through new business loans the UK business people can meet all requirements of a new and upcoming business like buying office furniture, paying for salaries, buying raw material or equipments and you can clear past debts as well.

In taking new business loans the UK people have secured or unsecured options. Secured new business loans require the business people to pledge any property as collateral. The advantages of secured new business loans are lower interest rate, greater amount of loan and larger convenient repaying duration. This makes the loan less burden some on the new business. On the other hand if you require only a smaller amount than there is no need to put your property as collateral. The lender will approve smaller amount without any security offer from the borrower. However interest rate on unsecured new business loans goes higher depending on personal circumstances of the borrower. If credit score of the borrower is too low then interest will be charged at very high rate.

But you should be prepared with a business plan to show it to the lender either taking secured or unsecured new business loans. The lender would like to see as to where are you going to invest the loan. The lenders also want to see the future income generating prospects of the loan. Also make sure that you have the loan repayment plan in place along with documents of income and bank statements.

And do not worry at all about your bad credit history. New business loans are provided also to people who failed to repay loans in time or have county court judgments. You can find such lenders in plenty on internet. Compare them for rates and terms-conditions. Clear the loan installments regularly so that your business gets loans at easier terms in future.

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