José María Rodríguez Clemente*
Russia is today a country bustling with activity that keeps evolving on a daily basis and has little or nothing to do with the environment of insecurity and organized crime that some imagine and which only vaguely resembles the country that it ceased to be many years ago.
In the words of Aliona Yakovleva, a young consultant working in Siberia, Russia may be one of the most grateful rewarding countries businesswise, especially for foreigners. The products and services of European origin tend to receive more trust than the ones made in Russia. Simultaneously, a predictable and generous tax system and an incomplete legislation offer great opportunities to exporters and investors from abroad.
¿Which are the keys that no foreign entrepreneur can disregard when dealing with this great market, so full of potential but at the same time so complicated for the ones who ignore its secrets? Below we reveal 10 basic insider tips. Complete information for doing business in Russia can be found in the Russia Business Culture and Etiquette Guide.
Get to know the market of your products and its potential clients
In Russia accessing relevant information can be difficult and official bodies do not always provide you with reliable data. Success or failure may depend on the identification and initial knowledge of the niche which you intend to take: it is highly recommendable to count on a partner with a presence in the market and access to internal channels of information.
Russia may be one of the most grateful rewarding countries businesswise, especially for foreigners
Adapt your product correctly and be very careful with formalities
The key is to find the balance between fitting well in the market and innovating with respect to the preexisting supply. The promotional material with which you will address a possible local partner has to be in presentation format, well translated into Russian and include high-quality visual material.
Regarding your personal presentation, in your first meeting with a potential Russian partner you should pay close attention to all details: Russians are very particular about personal clothing, style and image in general.
If you translate your web page and your visit card into Russian you will score points in the way they perceive your commitment and interest in the country.
Cultivate long-term relationships based on trust with your partners, providers and clients
The Russian business culture relies more on personal relations than on any other legal, formal or technical factors. Get ready to hold a high number of conversations and personal meetings with possible partners and clients to establish a firm foundation for your success. Remote means of communication, such as the e-mail, the phone or Skype may serve to solve everyday problems, but personal contacts will be indispensable to maintain relations alive and to progress in the cooperation with your Russian counterpart.
When it comes to business matters, Russians are strictly punctual and it’s not uncommon for them to arrive at a meeting even half an hour too early. Being ahead of the agreed time for an encounter will show your interest in the good course of the future cooperation.
Avoid the informalities and the empty promises
Russians are analytic, practical and very straightforward. Avoid inexactitudes, endless terms and vagueness. Present always specific issues and don’t be afraid to utter a categorical “no”. Don’t promise anything that you won’t be able to accomplish on time, or you will forever lose the trust of your local contact to the benefit your competitors.
Get ready to initial positions characterized by aggressiveness and distrust
The Russian business executives are distrustful by nature; thus, there is no need to worry if at the beginning they appear rude or arrogant to you: if you act with respect and keep your word, overcoming this barrier will only be a mere matter of time.
In a negotiation, the Russian mentality differs from the European one: they will focus its strategy not in being the ones who benefit more, but in losing less than the counterpart. Hold your positions even if they threat with abandoning the room or interrupting the negotiation: these are typical strategies of pressure by their side.
Identify the person who takes the decisions and address him directly
The Russian companies use to have a very hierarchical structure, with a very restricted number of people who take all decisions. Don’t waste your time negotiating with intermediate managers: without the approval of the highest ranking persons whatever you will decide may be eventually invalidated or considerably postponed.
Don’t overlook the informal channels of communication
Although it may seem a cliché, many important entrepreneurial decisions are taken in Russia with a bottle of vodka over the table. If a Russian partner invites you to drink after a business encounter and you refuse the offer, it will be better if you can offer him a convincing excuse. Otherwise, he may perceive it as an offense.
Appoint reliable people to be your eyes and ears in your absence
Even if you can travel more or less often to Russia, is essential that you procure yourself with a permanent representative, a good Russian lawyer and a customs agent. The first one will allow you to ensure a fluent relationship with your clients and partners ( an element that Russians appreciate particularly); the lawyer will help you to take advantage of legal loopholes and the customs agent will help you to reduce time and costs in the not uncommon case of merchandise getting locked in customs.
Take the internet into consideration as a marketing tool
Social media is the most important online activity in Russia. Being present in a Russian social network such as VK (the biggest European online social network) may help you to reinforce your brand image, sell trust and stay in touch with your clients.
* Managing Director of Rusbaltika, a consultancy firm specialized in advice, representation and investments in Russia and the Baltic countries.
To obtain The Complete Negotiation and Business Etiquette Guide in Russia, click here.