Marketing Concept

…the timing is right to begin now Business Development In Eurasian Emerging Markets

Introduction

Since the disappearance of Communism from Eastern Europe and the republics of the former Soviet Union (New Independent States, NIS, CIS), Western commercial high technology companies have started to establish fully staffed sales presence throughout Eastern European cities and in NIS, primarily in Moscow. The users of high technology products such as networking hardware and software in these emerging geographies are energy producing companies, telecommunications companies, banks, government agencies, the Academies of Science, and the dense and tightly connected university system.

Global companies such as Thomson Group, Daimler Benz, General Electric UK, and Sprint have installed facilities, hardware and software, and managed the projects that accompany these products for several years. These global companies are well respected for their successful business decisions, yet many smaller companies are holding back, perhaps because of the often dramatized stories of difficulties encountered.

Nevertheless, the conclusion is that the Big Emerging Markets of Eastern Europe and the NIS are some of the best remaining opportunities kept in the high tech international marketplace.

Contrary to press reports about these markets, often characterized by such words as "risky", "dangerous", "wild frontier", "lawless", and "lacks legal structure", doing business in these regions can support high growth and become profitable quickly. Eastern European and NIS users of computer products are able to pay in your currency, and often are well-funded, shrewdly managed, and anxious to acquire the latest technology, now that CoCom rules have been eliminated for these countries.

Of course, there are some commercial activities that work well and some that don't. It makes sense to understand which activities have not yet found a market, or that are subject to local pressure from criminal elements.

Activities that are susceptible to criminal activity are far removed from the industrial global companies, their products, and their customer profiles. Some of the ventures or arrangements to be wary of are:

Import and sale of commodity items (food, clothing or luxury items for distribution or sale).
Storefront service products such as restaurants and car washes.
Entertainment based products such as casinos or international bars.
Partnerships with Russian companies with split ownership of the company assets (often housing and office space).
Radical groups with a declared religious conviction.
Retail auto sales and service.

Business activities that continue to be safe, secure, successful, profitable, and fast-growing are:

Services in accounting and legal fields (Ernst and Young, Latham and Watkins).
Conversion projects using former military or aerospace resources.
Sale of previously restricted computer technology products.
Development of direct marketing infrastructures (Amway, Mary Kay, Shaklee).
Training in entrepreneurial topics such as Professional Selling Skills and Business Planning.
Self development seminars, such as Dale Carnegie, Tony Robbins, and Context Associated.
Outsourcing of any service or product to a local company (sales partners, or project teams).
Sales of equipment to industrial and commercial enterprises through other than retail channels.
Development of equipment sales and support to the Russian energy sector.

Key Industries In Eurasian Emerging High Tech Market

Scientific Research - Academy of Sciences, aerospace and defense conversion industries.
Finance - Central Bank of Russia, largest commercial banks (AgriProm, Dialog, Siberian Trade).
Telecommunications - Regional telephone companies, wide area messaging products, MICEX.
Oil and Gas - Gazprom, Caspian Oil Shelf, Tyumen region, regional electrical distribution.
Other local energy - Municipal electric, heating and transportation.
Education - University networks, distance learning.
Manufacturing - Aviation, Auto.
Government - Police, Aviation, Customs.
Raw materials - Gems, gold, other metals and minerals.

Challenges Of Market Entry

CCS staff and associates have lived and worked for more than four years in Eastern Europe and Russia and been actively engaged in business development there for over 7 years. The company is exceptionally well qualified to describe the challenges and develop solutions when entering these markets. CCS has achieved results repeatedly in Warsaw, Prague, Budapest, Kiev, Moscow, St. Petersburg, Novosibirsk, Baku, Alma-ata, and Tashkent. Here is a brief list of obstacles to market entry and evidence that CCS Associates can deliver results in a timely and cost effective fashion.

Assumption: The product or service has already been established as one that is being pulled into the marketplace. This has been demonstrated by competitive analysis, market data on TAM, existing installations of the product through customer import, or previous company analysis.

Challenges And Past Results

Challenge: Establishing a business model consistent with local accounting, legal, and government policies. It is critical to establish this model and adhere to it from the beginning. It is quite easy, in the haste to get into the selling phase, to put off the business model until a business is established. It is much harder to do it later, especially if growth is high and it continues to be subverted by day to day activities. Results: Established an installation, support and training business model for Unix client server installations within six weeks of permanent arrival in country. Challenge: Development of localized marketing, sales, support, and marketing communications strategy and materials.

Results: Converted training and support literature from English to Russian using local a project team including a legal review within 8 weeks.

Challenge: Hiring or contracting the infrastructure to support the business model and marketing plan.

Results: Developed and implemented a functional organizational chart which grew the infrastructure from one person in one location to offices and staff in 6 cities in Eastern Europe and CIS.

Challenge: Setting up the facility and furnishings in the best location at a cost effective price.

Results: Created a totally equipped sales and support office in Moscow using local suppliers and staff.

Challenge: Effectively communicating needs and establishing company off-shore business support.

Results: Created a three-year business plan with corporate support illustrated and justified, for finance, sales, and marketing.

Challenge: Product and process training specific to a company product or service.

Results: Established or sponsored sales training, product training and technical training for end users and sales partners of Unix client server systems including Java programming.

Challenge: Availability and distribution of your product.

Results: Discovered, negotiated, and partnered with local Russian distribution firm for import, export, and internal distribution of computer products.

In summary, to enter this market and achieve growth and profitability requires an experienced resource in an international startup operation. A knowledgeable, experienced partner is essential - one who will deliver the solutions to the challenges, because they have done it repeatedly, tirelessly, cost effectively, and successfully. CCS ASSOCIATES is the partner that will deliver these results.

To discuss your product or service opportunities in Communist countries, of the former Soviet Union, direct your questions and current business concerns to:

Jerry Carpenter, Managing Principal, CCS ASSOCIATES 1134 SW 326th Place Federal Way, WA 98023 Phone/Fax: 253-943-1622 E-mail: jcarp@ccstrat.com