Consulting

DUE DILIGENCE

Consulting services are services provided by an independent contractor through consultation. The consulting services model aims to eliminate organisational difficulties. Then the functions are reintegrated in a simplified environment. Consulting is most often used when a company needs an external expert opinion regarding a business decision. For example, a company seeking to sell its products abroad may need a consultant who is familiar with the business practices in a target country. A consultant will tell the company what are the best practices that should be followed, what to expect from customers and how to handle foreign regulations.

Today, Russian market is becoming increasingly popular for foreign companies, thanks to high production speed, advanced logistics and relatively low prices. For this reason, consulting companies are starting to enjoy an increasing demand, as they help to overcome such obstacles to running a successful business in Russia as structural unfamiliarity with Russian business and local laws and traditions.

RESEARCH

Marketing research is a type of sociological research focused on studying the market situation, desires, preferences and behaviour of consumers and other market players. The Russian market research industry is growing rapidly, driven both by domestic growth and the huge interest in the country by foreign investors.

The execution of an in-depth market research is a fundamental first step for any business that wants to enter a new market or industry in order to sell well-targeted products or services. It also serves as an essential platform for the development of well-planned business decisions, as it provides a clear acumen awareness of the environment. Market research thus minimises risks and increases potential for profit making. The goal of any marketing research is ultimately the formation of the company's strategy and tactics, taking into account the actually existing and potentially possible market factors and conditions, on the one hand, and its position and prospects, on the other.

MARKET ENTRY

Russia is the largest country in the world with varied market segments spread across eleven time zones. With a population of 142 million, the Russian market has enormous potential. The major markets of Moscow and St. Petersburg are well served and new market entrants will face stiff competition from established businesses.

However, other large cities such as Yekaterinburg, Novosibirsk and Vladivostok may not be as developed but can move quickly on a new product/service offering. In order for international companies to enter the biggest Eastern European market it is important not only to consider various market regulations but also to adapt to different mentalities and understand consumer behaviour of local population. 

BUSINESS DEVELOPMENT

Russia’s wealth in natural resources underpins its potential as a leading economy of the future. As the world’s largest oil producer, second-largest producer of natural gas, and possessor of great mineral wealth, Russia ranks eighth in the world by GDP and leader of the BRICS countries by per capita GDP.

The Russian government’s ambitions for economic development cover many core sectors. Developing the country’s oil, gas and mineral industries will require investment in excess of $24bn per annum in the coming decades, providing opportunities for suppliers of related machinery and technologies.

Its heavy industries and transport infrastructure are in great need of modernisation, requiring not only machinery and engineering but also IT, services and consulting support. The telecommunications market has grown strongly, with much future potential as next-generation mobile telephony and data services expand.  Modernising the healthcare system and building a strong pharmaceutical industry are also of core importance.

Metal work and tools manufacturing is one key contributors to the economy of Russia. The fact that Russia has the largest deposits of metals makes the country a cheaper place to run a company that is into the production of metal tools and instruments.

Retailing of commodities is yet another very flourishing business in Russia. The fact that Russia is considered as the 6th country with the highest purchasing power parity makes retailing business a very profitable venture in Russia.

The climate for doing business remains problematic, particularly for those looking to invest rather than simply trade. Bureaucracy and corruption can hamper business development; for this reason alone sound professional advice is strongly recommended.

Company due diligence refers to performing a thorough investigation of the company in order to minimise the risks that could lead to an unsuccessful cooperation. Russia can be a challenging market which means that international companies need to take time to learn about the business environment and select local partners wisely. Taking shortcuts when evaluating business opportunities and selecting local partners is not advisable.

Occasionally, basic information about regulations, company ownership and credit worthiness is not readily accessible, and the market’s regulatory framework continues to evolve, requiring companies to closely monitor changes. The purpose of due diligence in Russia mainly depends on what the client wants to find out about a company. Due diligence is usually performed when investors require to obtain all relevant documentation regarding the company they are about to enter in a relation with in order to evaluate the risks they are exposed to and to make an informed decision on the future steps to be taken.

MARKETING

Nowadays, the importance of marketing in general and marketing research in particular plays a big role for the establishment of Business in Russia. This is primarily due to the development of the market and market relations, increased competition, high consumer requirements for the quality of products. With the advent of specialised marketing companies providing a wide range of services in the Russian market, there has been an increase in the efficiency of production processes in enterprises. The implementation of various marketing approaches in the enterprise management process and in the production processes plays crucial role in the Russian market. 

Cultural sensitivity and understanding of protocol is paramount to effective marketing. Traditional advertising media are well established in Russia and they work well, in particular for consumer goods. Television, print media, outdoor billboards, magazines, point-of-sale promotions and displays, and free samples are widely used. Person-to-person direct marketing also works well. Besides, e-commerce and online marketing are developing at a very high speed.

MARKET EXPANSION

Well-organised distribution channels have developed significantly over the last 20 years, particularly in the major population centres of Moscow and St. Petersburg, and have started to expand to the regions.

In order to enter Russian market successfully, it is important to invest some time and resources into a precise marketing strategy in order to identify customer segment and the ways to reach it. In addition, before entering Russian national market, one has to consider legal regulation and state rules regarding various products’ advertising. Besides, one of the key elements to expand in Russian market is to be able to provoke customer interest and to adapt to cultural differences. 

NETWORKING

Networking is an increasingly important part of Russian business culture. The process of building relationships, communicating with different people, as well as providing support for their part is not new to Russians. The mentality of Russian people is a fertile ground for the development and improvement of networking in Russia. The organisation of business schools, training programs, internships, conferences displays the ability of Russian businessmen to build partnerships on a professional level. There are also numerous networking groups, clubs and professional associations dedicated to business and individual professions.