5 Mistakes Companies Make When Expanding Into Asia

We took a look at some of the common mistakes that companies make when they’re expanding into Asia. So, below we have handled five vital ones that you need to know and avoid. But before that, let’s look at why you even need to expand into Asia in the first place.

5 Mistakes Companies Make When Expanding Into Asia

Most companies make costly mistakes when they’re expanding into Asia. It is essential that you make all considerations to ensure that your business is roadworthy and sustainable down the line. And part of doing that is taking on paths that lead to success. Strategic planning is important when you’re expanding to foreign territories. Thus, it would help to carry out a feasibility study and test the market before venturing further. We took a look at some of the common mistakes that companies make when they’re expanding into Asia. So, below we have handled five vital ones that you need to know and avoid. But before that, let’s look at why you even need to expand into Asia in the first place.

Advantages of Companies Expanding in Asia

Most of the Asian countries provide a suitable environment for SMEs and multinationals to expand their business operations. As a business, you might be asking or wondering why this is the time to expand into Asia. Well, here are some incentives why you need to do so:

Developed Infrastructure and Funding

Most Asian countries, such as Singapore, have a well-established infrastructure that provides a good business environment. There’s also generous funding that ensures SMEs and global businesses get the proper support they need. Singapore is one of the Asian countries with the most startups and a technology ecosystem. Their digital economy is also booming and rapidly improving. South Korea and Vietnam are also great business hubs. They have supported the growth of many startups and SMEs, especially in the tech niche.

Local Talent

Asia provides a bulk of skilled talent ready to pump their ideas and expertise into businesses. SMEs can leverage and take advantage of this broad talent base to expand into Asia. The presence of local talent helps cut down on costs for foreign businesses. Instead of importing talent from other parts of the world and training them to meet the local business culture, they can just hire professionals from within.


Asian markets have a high rate of competition. But worry not. With the right marketing strategy and differentiation, your business can stand out and get an influx of customers. The trick is to learn how to localize your products or services to align with the country of operation.

Monetary Incentives

Governments in Asia generally offer a shoulder to lean on for most companies and businesses. Thus, you can be sure of not staying in the cold alone for long before getting help. Some of the incentives that entice businesses include competitive tax rates, tax rebates, and free trade agreements. Singapore, for instance, is widely popular because of its incredibly low corporate tax rates.

Factors to Consider Before Expanding Companies into Asia

When expanding into Asian countries, you don’t do so blindfolded. You need to check out some of the critical factors that determine business operation. Here are some of the things that you need to consider:

Size of the Market

Knowing the kind of opportunities that exist in the Asian market is essential. But first, you will need to analyze the size of the market. In Southeast Asia, eCommerce is doing well. On the other hand, Asian countries such as Japan, China, and South Korea have a robust reputation for supporting mobile gaming. Thus, as a business in this category, you might want to go to these countries and get their base of resources and a huge market.

Cultural Sensitivities

This really goes without saying – Asia is a diversified region. Thus, you can easily fall victim to different cultural nuances, especially during business operations. Therefore, it might take some time before you get accustomed to this change.

Strategies to Make It Successful

To make your company succeed when expanding into Asia, you need to take note of the following strategies:

  • Become a part of the native culture.
  • Bolster strategic localization through hiring native talent.
  • Optimize your online presence through the local social networks.
  • Drive meaningful campaigns within the region.

Things to Avoid

Also, you need to be cautious of the following when you’re expanding your business into Asia:

  • Ignoring the local business culture.
  • Not hiring local talent.
  • Not defining a purpose and mission clearly from the start.

5 Common Mistakes Companies Make When Expanding Into Asia

So, without wasting any time, here are five common mistakes that companies make when they’re expanding into Asia:

Expanding to too Many Markets at the Same Time

Ambition is great, but don’t be too ambitious. When you’re expanding into a foreign region such as Asia, you need to take it slow and steadily. Don’t be in a rush to go everywhere at the same time.

Dropbox Case Study

Another vital mistake that companies make when expanding into Asia is using the Dropbox case study, which often leads to making misleading decisions.

Targeting Harder Markets First

Start with markets that you can penetrate easily rather than breaking the hard stone. This will help your company proliferate. And when you’re finally successful in the more accessible markets, you can now aim for the hard ones.

Expanding for the Sake of Increasing Valuation

Your reasons and mission to expand should be clear enough. If you’re doing it solely to increase valuation, you’re doing it wrong.

Assuming All ‘Locals’ are Locals

Go with a business that can adapt quickly and is equipped with the specialized insight and skills such as industrial design to develop products for the real world. 

Final Thoughts

We hope that by this far you have learned several things that can help you when setting up a business in Asia, or expanding it for that matter. Also, avoid the mistakes that others have made to increase your chances of making it in this space.