How to make the decision between a subsidiary or agent in India? Is having my own set-up ideal when it comes to the Indian market compared to working with an agent?
There are pros and cons to both having your own subsidiary or agent in India – and most of them are to do with transparency and level of investment.
|Pros||First of all, you stay in control of all aspects
Plus, you internalize everything you learn about the Indian market
In addition, setting up your own subsidiary in India is getting easier and easier
|Most importantly, you don’t need to become an expert on every aspect of doing business in India
Also it is a good way to get your first taste of India’s market potential without major investment
|Cons||However, there’s a lot to focus on and you really need to hire the right Indian team to ensure you know what is going on
Also it is not the cheapest option
|The trouble is that you don’t know that your agent is working 100% for you
And you don’t really learn what is working and not working for you
The decision should also be based on a through market study on the potential of your products in India. If you already have a customer base or if your products are of high demand in India, it is suitable to have your own set-up in India. However, evaluate your investment options before making the decision. Many foreign companies also consider a JV or M&A as a preferred choice to immediate gain market share in India.
If you are not sure about the choice to make, M+V can help you with short term alternatives – our business incubator allows you to hire and control your own sales team on our support platform. This means all the biggest headaches are taken care of for you while you make the decisions about how to grow your sales. Our systems are all set up so you can come on-board really quickly.
If you wish to test your market with an agent, our India Experts can help you identify the right partner for you.