Investing in an Online Presence in Asia

Posted on by

By Alberto Vettoretti, Dezan Shira & Associates

Asia is fast on its way to becoming the largest e-commerce market in the world. Internet penetration is growing by leaps and bounds, and the region’s youth population increasingly prefers to interact with companies and retailers over the internet rather than with more traditional forms of physical shopping and communication. Alongside these developments, Asia’s fast-growing middle class has fostered the evolution of a strong online consumer culture that cannot be ignored by companies seeking long-term success in the region.

A keen understanding of the trends and developments currently shaping Asia’s e-commerce landscape is key to fostering a successful growth strategy in Asia for almost any type of business. Increasingly, interacting with a company’s online presence is the first contact prospective clients and customers have with an organization, and can be a critical determinant of that relationship’s ultimate success.

For companies not yet prepared to establish physical operations in developing markets across Asia, establishing a local headquarters and online presence in either Singapore or Hong Kong can serve as an effective gateway to the wider region.

Singapore in particular is an increasingly popular destination for companies seeking to test the waters in  key markets and lay foundations for Asia-wide e-commerce operations. The city-state’s business-friendly tax regime, straightforward legal system, and minimal requirements for company establishment make Singapore an effective base for establishing an online presence and conducting e-commerce operations across Asia.

Even without a local online presence in every market, companies can successfully tap into Asia’s e-commerce potential through a holding company in Singapore or the organization’s country of origin. Sites such as Amazon.com exemplify this strategy, with rapidly growing popularity across the Asia-Pacific region despite lacking an online presence in each individual market. It should be kept in mind, however, that websites that tailor to the local tastes and demands of individual markets are often significantly more successful than those that do not. eBay’s failure to fully adapt to the Chinese consumer’s unique tastes and preferences, for example, ultimately resulted in the retailer losing out to Alibaba’s Taobao and Tmall online marketplaces.

Establishing an online presence in Asia can oftentimes be confusing for companies attempting to navigate country-specific processes and regulations, and expanding beyond a holding company jurisdiction usually requires the assistance of a professional services firm. This can ensure a company’s successful establishment and entry into operations in the emerging e-commerce markets of Asia.

This article is an excerpt from the May 2014 edition of Asia Briefing Magazine, titled “E-Commerce Across Asia: Trends and Developments 2014.” In this issue, we provide a comprehensive overview of e-commerce trends across the Asia-Pacific region with a focus on developing markets in Southeast Asia. In addition to analyzing macro-level economic and development indicators that signal the potential for region-wide growth, we explore several rapidly growing markets in-depth while highlighting opportunities for investment in each.

Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email asia@dezshira.com or visit www.dezshira.com.

Stay up to date with the latest business and investment trends in Asia by subscribing to our complimentary update service featuring news, commentary and regulatory insight.

Related Reading

China Further Promotes E-Commerce Development

Shanghai FTZ Launches Cross-Border E-Commerce Platform

China Offers Preferential Tax Treatment to Exports by E-Commerce Retail Enterprises

Vietnam Online – Understanding Vietnam’s E-commerce Market

DIPP to Push for Higher FDI Cap in E-Commerce

E-Commerce on the Rise in India

Leave a Reply

Your email address will not be published. Required fields are marked *

Never Miss an Update

Subscribe to gain even better insights into doing business in Asia. Subscribing also lets you to take full advantage of all our website features including customizable searches, favorite, wish list and gift functions and access to otherwise restricted content.

Scroll to top