Paradise for offshore suppliers?

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While the economies in western economies are picking up, the shortages of skilled resources (IT, HR, finance) are increasing. Prices are going up and new opportunities for offshore suppliers arise.

The perception

Some offshore suppliers may think of western markets like a paradise of low hanging fruit waiting to be picked: projects waiting for a supplier.

They send emails to demanding organisations and ask local agents to find the projects on a commission-only basis.

The deception

After one year little or no fruit has been picked. The offshore supplier doesn’t understand why.

The diagnosis

The business is really there, but the competition too.

Thousands of suppliers from forty or more countries in Asia, Eastern Europe, North Africa and Latin America are targeting the same markets.

Large suppliers have opened local offices long ago, including aggressive sales staff and skilled delivery managers. Large clients have selected their preferred suppliers already or have created their own offshore delivery units. Small clients are still reluctant to do business with companies and people they don’t know, despite their demand.

New offshore suppliers don’t understand the way western clients like to do business and fail to gain the necessary trust.

The remedy

Entering a new market requires knowledge, visibility, relations and adaptation.

Market knowledge may be obtained by market research or by listening to experienced guides.

Visibility may be created by coherent marketing activities and therefore a marketing plan.

Relations can’t be built overnight. They require personal attention during a longer period of time. Face-to-face meeting with clients are essential, preferably in a local onshore office. In the beginning local representatives may play this role, but soon offshore managers need to be engaged as well.

Based on market knowledge and understanding the needs of the client, it will become obvious how the delivery models needs to be adapted.

Suppliers who are prepared to invest in knowledge, marketing, local presence, travel cost and delivery adaptation will get their share of the paradise. Others could better keep dreaming of paradise.

Offshore suppliers who need guidance may 

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