India Lean Global Expansion

Introduction

India is a complex, diverse society that presents a growing opportunity for global expansion. It has long operated as a self contained nation that does not exert itself on a global stage, rather choosing to focus on internal matters. Over the past 30 years India has developed a reputation as a cost effective outsourcing hub. While this industry remains a legitimate option for lean global businesses, the domestic market size and technology adoption are opening up the Indian consumer as a consideration for growth.

Population

The population of India is a staggering 1.3 billion, which should be reason in itself to explore the business opportunities it presents. In 2019, India surpassed the UK to be the 5th largest economy, with economists estimating strong growth to continue. According to the World Bank between 2011 and 2015 more than 90 million people were lifted out of poverty. The population is rapidly moving into the middle class and adopting technology solutions to solve daily needs. Companies exploring global expansion should however remain diligent as the population of India is highly diverse ethnically, linguistically and socioeconomically. Basic assumptions about how to do business must be tested in order to succeed.

Unicorns

A top reason to consider India is the development of the technology industry, notably the rise of unicorns companies such as Flipkart, Ola, Snapdeal and Paytm. According to Credit Suisse, there were over 100 unicorn companies in India as of 2021. The Indian technology industry grew on the backs of IT outsourcing growth in the late 1990s and a repatriation of Indian nationals after gaining experience abroad. This has fostered an tech ecosystem that is now competing on a global stage.

English Speaking

A sometimes underrated consideration when assessing global expansion is the local language and the complexity that can bring when doing business. In comparison with other Asian opportunities, such as China, Japan or Indonesia, the majority of Indians do speak English and government operations take place in English. In other Asian markets, basic business operations such as submitting tax documents, drafting employment agreements or company incorporation require translation in addition to sales and marketing efforts to connect with the local consumer base. Companies taking their first step overseas look to limit unnecessary complexities until they have the institutional experience to manage them and language is a common example of this.

Talent

India presents a diverse and large talent pool that companies have long looked to tap. India is unique in that there is a class of talent with world class technology and sales experience. Companies with large offices such as Google, SAP and Facebook has developed the growth for local talent. Concurrently, the outsourcing industry with lower wage workers remains a viable option for companies looking to diversify their cost base.