Starting a small business in Korea
When it comes to working in Korea, most of us think ‘teaching English’. While it’s true that teaching English is a popular and profitable proposition, if you are looking to do something different, don’t give up just yet. Korea has a lot more to offer work wise besides teaching English. Opportunities to do business in Korea are varied and abundant.
However before jumping in, like with any other international market, you need to do market research before starting a business in Korea. While researching ask yourself these questions:
- Will my product or service appeal to the Korean market?
- Who are my competitors in Korea?
- What should I charge when entering the Korean market?
- What are the regulations if I want to export to Korea?
- Is it easy to find business premises in Korea?
- Do I need a Korean bank account to start a business in Korea?
- Is it necessary to have a Korean accountant?
- Do I need a Korean business partner?
Apart from researching the market, you also need to remember that there are vital differences between Western practices and Korean business etiquette. Here are a few tips that can help you with starting your business in Korea.
Get a Korean partner
Generally, to start a business in Korea you will need a Korean bank account and you will need to register your company in Korea. Like anywhere else, starting a business in Korea requires a lot of paperwork and red tape. Therefore, it is advisable and highly recommended that you get a Korean partner. It can be a Korean spouse, accountant, or friend. Business in Korea and other parts of Asia revolves a lot around personal relationships. Also, since most official paperwork is done only in Korean and many Koreans still struggle with English, in order to do the administrative work such as taxes and business registration and foster business relationships it is much easier to have a Korean partner/ friend at your side. A capable Korean partner can help you and make the whole transition easy and stress free.
Have a Target Audience in mind
You will be surprised by how many good business ideas fail because they target the wrong audience. Know your consumer base. Think about the kind of consumers your product is most likely to appeal to. Korean consumers are different than western consumers. Think about the preferred price range, the income bracket, the culture, the mind set etc. of the buyers you are hoping to attract.
Find an appropriate Location
Location is perhaps among one the important if not ‘the most important’ thing to brainstorm before you start your business. Surely you have a location in mind but is it viable? Have you thought about all the startup costs necessary? It’s baffling how many owners do not think about the location thoroughly. If you already know your target market and desired location consider things like comfortable parking for customers, easy accessibility by public transportation, general age group and income level of the buyers in the surrounding neighborhood. For example: if you plan on opening a high-end restaurant you may want to consider the more upper class neighborhoods. And even though things like comfortable parking may sound trivial, I cannot count the times I have not checked out a store I really wanted to, due to inconvenient parking.
Advertising/ Website and Social Media Presence
Yet another important aspect for any successful business is good advertising. You may have a unique business offering amazing products but it won’t thrive if people don’t know about it. Having a good business concept and strategy without proper and adequate advertising is a recipe for disaster. I know someone who had a brilliant idea of starting a ‘one of a kind’ business with no competition in the neighborhood. She could have made bank but she did not advertise properly and her business failed after several months.
So think about how are you going to promote your new business? Do not skimp on advertising. Remember shelling out a little bit of cash in the beginning will go a long way down the road. These days, with the advent and popularity of social media, advertising is a piece of cake. Have a strong web presence and you will succeed. Advertise in the area and the surrounding neighborhood. Have special events, discount etc. Start an easily accessible website, where people can find information about your business and location or start a Facebook page where you can post pictures and feedback. Always have a ready supply of business cards etc.
Compared to a few decades ago, it is much easier for foreigners to start a business in Korea these days. Moreover, the central and city governments across Korea have made information and assistance for foreign entrepreneurs easily accessible. Korean consumers, especially in bigger cities appreciate businesses run by foreigners since they tend to be distinctive and do things a little differently. Hopefully these tips will help you start a successful business venture in Korea.